#1

G.R. No. 161104 September 27, 2006

NYK-FIL SHIP MANAGEMENT INC. and/or NYK SHIP MANAGEMENT HK., LTD., petitioners,

vs.

THE NATIONAL LABOR RELATIONS COMMISSION AND LAURO A. HERNANDEZ, respondents.

Jan. 21, 1999 - By contract, petitioner NYK Ship Management (HK) Ltd., through its local manning agent-co-petitioner
NYK-Fil Ship Management, Inc., hired Lauro A. Hernandez (respondent) as a boatswain on board the vessel S.S. LNG
FLORA for a period of eight months.

A boatswain, also known as a bosun, is the senior crewman of the deck. He is responsible for the ship's hull
and all its components, including its rigging, anchors, cables, sails, deck maintenance and small boat
operations.

Note: Before the contract was executed, respondent was made to undergo the routine Pre-employment Medical
Examination (PEME) and was found to be fit to work by the attending physician, Dr. Clarissa M. Mendoza. On the
query contained in the medical history portion as to whether he was suffering from or had been told that he had any
disease or ailment, including "rheumatism, joint or back trouble," respondent answered in the negative.

Jan. 28, 1999 - respondent boarded the above-named vessel and commenced to perform his duty as boatswain.

February 22, 1999 (25 days later) - while the vessel was approaching Davao City, respondent requested for medical
attention due to high fever and pains at his left hip bone socket. He was immediately brought to the Davao Doctors
Hospital and before the attending physician, Dr. C. Serrano, he disclosed that he had been experiencing "fever since
January 17, 1999, moderate to high grade, intermittent, associated with chills, body malaise and pain on
lumbosacral area radiating to left lower extremity." The initial impression of his condition was that he was suffering
from left gluteal abcess and septic arthritis left hip.

Respondent was thereafter transferred to Manila and was referred to petitioners' company-designated physicians at
the Metropolitan Medical Hospital (MMH).

March 26, 1999 - discharged after undergoing MRI or magnetic resonance imaging of the thoracic and lumbosacral
spine which showed negative results. Respondent was then prescribed medications, started on physical therapy.

May 1999 - respondent's condition was finally determined to be septic arthritis and/or avascular necrosis of the left
hip. His rehabilitation program with skin traction continued and he started taking antibiotics.

By early November 1999 - respondent's proposed surgery (left hip debridement and possible total hip replacement)
was approved but despite being notified of the approval, he failed to report for scheduling thereof.

November 16, 1999 - respondent instituted a complaint against petitioners, praying for, among others, disability
compensation benefits equivalent to Grade 1 or total permanent disability amounting to $60,000.

February 3, 2000 - respondent underwent surgical operation for a total hip replacement at the MMH. Thereafter, he
continued to report to his orthopedic surgeon and was advised to continue his home exercises.

April 28, 2000 (Letter by respondent's orthopedic surgeon, Dr. Tiong Sam N. Lim) - wrote the medical coordinator of
the MMH regarding respondent's case, recommending that respondent's disability grading be half of grade 9 or
complete inability of a hip joint in full extension of the thigh
 Respondent: compensability of an illness is not dependent on whether it is work connected or not, it being
sufficient that it was contracted during the term of the employment contract. Additionally, he proffered that
since he could no longer engage himself as a seafarer, he is entitled to disability benefits for total and
permanent disability.

Petitioner: the filing of the complaint was premature since respondent was under continuous treatment, and
while there was possibility that he might end up disabled, he might also end up fully cured and fit to work. In
any event, petitioner emphasized that respondent's condition arose from a pre-existing illness, hence, not
compensable.

April 4, 2001 - LA ordered respondent to submit himself before the Employees Compensation Commission or any
government hospital for physical examination in order to determine whether he is fit to work, or in the event that he is
disabled, to determine the extent of his disability.

Complying, respondent submitted himself for evaluation at the Philippine General Hospital. In the medical certificate
dated June 25, 2001 issued by the attending orthopedic surgeon, Dr. Rafael Cruz Bundoc, the following pertinent
portion is noted:

Presently, patient is ambulant with no hip pain. Patient however has limited range of motion over his
left hip joint compared to the right, and has difficulty in squatting. Patient also cannot move briskly in
going up and down stairways, walking in ramps and embankments. Difficulty in running is
conspicuous even for very short distance.

Considering that the medical wall of his acetabulum over the operated side is thin, there is a danger
that he might develop protusio acetabuli or some other attrition problems in the future. With these
clinical conditions, it is not advisable for the patient to engage in manual work that would entail
prolonged standing, running especially carrying heavy objects.

LA Decision - respondent was entitled to disability benefits, equivalent to half of Grade 9 as found by the company-
designated physician, Dr. Tiong Sam N. Lim.
As established, parties signed a POEA contract, the terms and conditions are specified therein. One
of the provisions of the contract states that the company-designated physician determines the
seaman's disability grading.

xxxx

The contract of employment specifically mentions company-designated physician. Dr. Tiong Sam N.
Lim, M.D., who opined and suggested that complainant's disability grading would be half of Grade 9
(Complete inability of a hip joint in full extension of the thigh). To agree to the claim of complainant
would be to encourage and disregard and violate the government approved contracts, in
effect, promoting disrespect to government authorities

Respondent: there is no such thing as an impediment grade of ½ of Grade 9 under the POEA Standard
Employment Contract as the company-designated physician could only choose among the impediment grades
of 1 to 14 - given petitioners' company-designated physician opinion that it would not be advisable for
respondent to resume work as a seafarer, he is entitled to permanent total disability compensation.

NLRC Decision - modified the decision of the Labor Arbiter, petitioners' negligence, coupled with the fact that the
nature of the illness of respondent renders him incapable of pursuing his profession as a seafarer, sufficed to categorize
respondent's disability as permanent total disability.

MR - Denied

CA Decision - Affirmed ruling of the NLRC

ISSUE: WON respondent is entitled to Permanent Total Disability benefits?

RULING:
No. Petition is granted. Reversed CA and NLRC Decision.

A seafarer is a contractual, not a regular employee, and his employment is contractually fixed for a certain period of
time.39 His employment, including claims for death or illness compensations, is governed by the contract he
signs every time he is hired,40 and is not rooted from the provisions of the Labor Code.

Provision number 2 of respondent's employment contract specifically provides that "the terms and conditions of the
revised Employment Contract governing the employment of all seafarers approved per Department order No. 33 and
Memorandum Circular No. 55 both series of 1996 shall be strictly and faithfully observed."

POEA Memorandum Circular No. 055-96 or the "Revised Standard Employment Terms and Conditions Governing the
Employment of Filipino Seafarers On Board Ocean-going Vessels" (POEA Seafarers Contract) provides for the
minimum requirements acceptable to the POEA for the overseas employment of a Filipino seafarer.

Section 20 (B) of said contract enumerates the liabilities of the employer when the seafarer suffers injury or illness
during the term of his contract.

ang naa diri is katong naa lang emphasis :) - Reina

SECTION 20. COMPENSATION AND BENEFITS

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS:

The liabilities of the employer when the seafarer suffers injury or illness during the term of his contract are as follows:

5. In case of permanent total or partial disability of the seafarer during the term of employment caused by either injury
or illness the seafarer shall be compensated in accordance with the schedule of benefits enumerated in Section 30 of
his Contract, Computation of his benefits arising from an illness or disease shall be governed by the rates and the rules
of compensation application at the illness or disease was contracted.

In order to hold petitioners liable to respondent for disability benefits, respondent must present concrete proof that he
acquired or contracted the injury or illness, which resulted to his disability, during the term of his contract. 45

As stated early on, respondent and petitioner NYK Ship Management (HK) Ltd. forged the contract of employment on
January 21, 1999 and respondent boarded the vessel on January 28, 1999 but was repatriated on February 21, 1999 46
on account of his ailment.

When respondent was examined at the Davao Doctors Hospital on February 22, 1999, he admitted that as early as
January 17, 1999, or nine days prior to his deployment, he had been experiencing "fever…moderate to high grade,
intermittent, associated with chills, body malaise and pain on [the] lumbosacral area radiating to left lower extremity."

From the chronology of events reflected above, it is clear that his ailment antedated his employment and that he did
not contract it while working on board S.S. LNG FLORA for more than three weeks.

Respondent was diagnosed as suffering from avascular necrosis with septic arthritis. Septic arthritis is a serious
infection of the joints characterized by pain, fever, occasional chills, inflammation, and swelling in the infected joint. 47
Infectious arthritis in the hip may be experienced as pain in the groin area that becomes worse if the patient tries to
walk.48 In general, it is caused by the spread of a bacterial, viral, or fungal infection through the bloodstream to the
joint,49 the most common cause being neisseria gonorrhoeae, the bacterium that causes gonorrhea.50
Avascular necrosis on the other hand is a condition in which there has been a circulatory impairment of an area of
the bone, leading to its eventual death.51 In its early stage, physical examination of the affected area may be within
normal limits, but a limp may be detected later if the lower extremity is involved. 52 Range of motion of the affected
region may be limited and may cause pain.53 Most of the cases involve younger adults and are associated with a variety
of conditions that cause circulatory impairment, the most common among which are prolonged glucocorticoid
administration and excessive alcohol intake.54

In Sealanes Marine Services, Inc., v. NLRC

this Court held that an employer is not liable for death compensation arising under the standard format contract
if the death of the seaman was due to an illness that was not contracted during the term of his employment
contract.

Thus, death arising from a pre-existing illness is not compensable. A fortiori, disability arising from a pre-existing illness
is not compensable.

Respondent’s CONTENTION: prior to employment, respondent underwent a thorough PEME conducted by the
company-designated physician and was pronounced "fit to work.”

SC’s REASONING: While a PEME may reveal enough for petitioners to decide whether a seafarer is fit for overseas
employment, it may not be relied upon to inform petitioners of a seafarer's true state of health. The PEME could not
have divulged respondent's illness considering that the examinations were not exploratory. It was only after
respondent was subjected to extensive medical procedures including MRI of the thoracic and lumbosacral spine that
respondent's illness was finally diagnosed as a case of avascular necrosis of the hip with septic arthritis. Respondent
was only subjected to routinary chest x-ray, stool examination, and urinalysis, thus:

If the diagnosis is Avascular Necrosis of the hip with septic arthritis it was not apparent at the time of PEME, note also
that it was not even one of the differential diagnosis when he was seen in Davao, and Metropolitan Hospital made the
diagnosis only 3 months after disembarkation. X-ray of the hip is not part of the PEME and again would like to
underscore the fact that even x-ray of his hip on March 3, 1999 was normal.58 (Underscoring supplied)

For respondent to thus claim that the issuance of a clean bill of health to a seafarer after a PEME means that his illness
was acquired during the seafarer's employment is a non sequitor.

It having been satisfactorily shown that respondent was really not fit to work as a boatswain due to his pre-existing
illness and, therefore, he is not entitled to disability compensation, necessarily, he is not entitled to attorney's fees.

#2
[G.R. NO. 172933 : October 6, 2008]

JESUS E. VERGARA, Petitioner, v. HAMMONIA MARITIME SERVICES, INC. and ATLANTIC

MARINE LTD., Respondents.

April 4, 2000 - petitioner was hired by respondent Hammonia Maritime Services, Inc. (Hammonia)
for its foreign principal, respondent Atlantic Marine Ltd., (Atlantic Marine). He was assigned to
work on board the vessel British Valour under contract for nine months.

The petitioner was a member of the Associated Marine Officers' and Seaman's Union of the
Philippines (AMOSUP). AMOSUP had a collective bargaining agreement (CBA) with Atlantic
Marine, represented in this case by Hammonia.
August 2000 - while attending to a defective hydraulic valve, he felt he was losing his vision. He
complained to the Ship Captain that he was seeing black dots and hairy figures floating in front of
his right eye. His condition developed into a gradual visual loss. The ship's medical log entered
his condition as "internal bleeding in the eye" or "glaucoma. He was given eye drops to treat
his condition.

The petitioner went on furlough in Port Galveston, Texas and consulted a physician (#1) who
diagnosed him to be suffering from "vitreal hemorrhage with small defined area of retinal
traction. Differential diagnosis includes incomplete vitreal detachment ruptured macro aneurism
and valsulva retinopathy.

September 5, 2000 - Petitioner was sent home for medical treatment. The company-designated
physician, Dr. Robert D. Lim (#2) confirmed the correctness of the diagnosis at Port
Galveston, Texas. Dr. Lim then referred the petitioner to an ophthalmologist at the Chinese
General Hospital who subjected the petitioner's eye to focal laser treatment on November 13,
2000; vitrectomy with fluid gas exchange on December 7, 2000; and a second session of focal
laser treatment on January 13, 2001.

January 31, 2001 - the ophthalmologist pronounced the petitioner fit to resume his seafaring
duties per the report of Dr. Robert D. Lim, Medical Coordinator. The petitioner then executed a
"certificate of fitness for work" in the presence of Dr. Lim.

Claiming that he continued to experience gradual visual loss despite the treatment, he
sought a second opinion from another ophthalmologist, Dr. Patrick Rey R. Echiverri (#3),
who was not a company-designated physician. Dr. Echiverri gave the opinion that the
petitioner was not fit to work as a pumpman because the job could precipitate the
resurgence of his former condition.

March 20, 2001 - the petitioner submitted himself to another examination, this time by Dr. Efren
R. Vicaldo (#4), a physician who was not also designated by the company. Dr. Vicaldo opined
that although the petitioner was fit to work, he had a Grade X (20.15%) disability which he
considered as permanent partial disability.

Armed with these two separate diagnoses, the petitioner demanded from his employer payment
of disability and sickness benefits, pursuant to the Philippine Overseas Employment
Administration Standard Employment Contract Governing the Employment of all Filipino Seamen
on Board Ocean-going Vessels (POEA Standard Employment Contract), and the existing CBA in
the company.

LA Decision January 14, 2003 - in petitioner's favor. The Arbiter ordered Hammonia and Atlantic
Marine to pay the petitioner, jointly and severally, sickness allowance of US$ 2,568.00 and
disability benefits of US$ 60,000.00 under the CBA, and 10% of the monetary award in attorney's
fees.
NLRC Decision March 19, 2004 - reversed the LA's ruling.9 It dismissed the complaint on the
ground that the petitioner had been declared fit to resume sea duty and was not entitled to any
disability benefit.

NLRC denied the petitioner's motion for reconsideration.10

CA Decision March 14, 2005 - dismissed the petition in a Decision promulgated and likewise
denied the petitioner's motion for reconsideration.

PETITIONER’S CONTENTION:

1. Invoke the ruling in Crystal Shipping Inc., A/S Stein Line Bergen v. Deo P. Natividad,13
in strictly interpreting the POEA Standard Employment Contract and the CBA between the
parties on the matter of who determines a seafarer's disability.
2. Giving credence to the certification by the company-designated physician, Dr. Robert Lim,
that declared him fit to work. On the assumption that he was indeed fit to work, he submits
that he should have been declared to be under permanent total disability because the fit-
to-work declaration was made more than 120 days after he suffered his disability.
3. The ruling in German Marine Agencies, Inc. et al., v. National Labor Relations Commission
- Dr. Lim did not personally operate on and attend to him when he was treated; he had
been under the care of an ophthalmologist since September 6, 2000. The petitioner
stresses that Dr. Lim's certification was not based on his first hand findings as it was issued
in his capacity as the "Medical Coordinator" of the Metropolitan Hospital.17 He also points
out that Dr. Lim is not an eye specialist.
4. It is the competence of the attending physician and not the circumstance of his being
company-designated that should be the key consideration in determining the true status
of the health of the patient/seaman.

It is the inability to work resulting in the impairment of one's earning capacity that is compensated,
not the injury itself. He maintains that even if his visual acuity is now 20/20 as alleged by the
company-designated physician, he can nevertheless no longer perform his customary work as
pumpman on board an ocean-going vessel since the job involves a lot of strain that could again
cause his vitreous hemorrhage. This limitation impairs his earning capacity so that he should be
legally deemed to have suffered permanent total disability from a work-related injury. In this
regard, the petitioner cites as well his union's CBA20 whose paragraph 20.1.5 provides that:

20.1.5 Permanent Medical Unfitness - A seafarer whose disability is assessed at 50%

or more under the POEA Employment Contract shall, for the purpose of this
paragraph is regarded as permanently unfit for further sea service in any capacity
and entitled to 100% compensation, i.e., US$ 80,000 for officers and US$ 60,000 for
ratings. Furthermore, any seafarer assessed at less than 50% disability under the
Contract but certified as permanently unfit for further sea services in any capacity by
the company doctor, shall also be entitled to 100% compensation.
Finally, the petitioner contends that because there is doubt as to the accuracy of the medical
opinion of the company-designated physician, the doubt should be resolved in his favor, citing
Sy v. Court of Appeals,21 as well as Article 4 of the Labor Code.22

RESPONDENTS’ CONTENTION

In a memorandum23 filed on December 20, 2007, respondents Hammonia and Atlantic Marine
entreat this Court to dismiss the petition under the following arguments:

1. The provisions of the POEA Standard Employment Contract and the CBA between
the parties clearly provide that the assessment of the company-designated physician
should be accorded respect.

Factually, the petitioner was declared fit to work by the company-designated

physician. Legally, only blindness or total and permanent loss of vision of both
eyes is considered a Grade I disability under the terms of the POEA Standard
Employment Contract. Under its Section 30 on the portion on "Eyes," only total and
permanent loss of vision of both eyes can be considered as Grade I disability, not
the petitioner's claimed impairment of vision in the right eye.

They point out that Dr. Vicaldo himself is not an "eye specialist."

2. There are no legal or factual bases for the petitioner's claim of total and permanent
disability benefits as he was declared "fit to work."

The respondents likewise question the petitioner's reliance on Art. 20.1.5 of the
CBA for his claim that he is entitled to 100% disability compensation since his
doctors, Echiverri and Vicaldo, declared him unfit to work as a seaman although
his disability was determined to be only at Grade X (20.15%), a partial permanent
disability. They contend that the petitioner's position is contrary to what the cited
provision provides as the CBA28 specifically requires a "company doctor" to certify
a seafarer as permanently unfit for service in any capacity.

3. The petitioner's reliance on the Crystal Shipping v. Natividad24 case is misplaced.

4. The petitioner is not entitled to attorney's fees.

The respondents object particularly to the petitioner's claim that Dr. Lim's assessment is not
authoritative because "Dr. Lim does not appear to be an eye specialist."26 They point out that
the issue of Dr. Lim's qualifications and competence was never raised at any level of the
arbitration proceedings, and, therefore, should not be entertained at this stage of review.
On the contrary, they point out that the petitioner concurred with the assessment of the company-
designated physician by executing a certificate of fitness to work.27
The respondents bewail the petitioner's attempt to have this Court find him permanently disabled
because he "was under the medication and care of the company-designated physician for over
four (4) months or more than 120 days." They cite Section 20 B of petitioner's POEA Standard
Employment Contract whose relevant portion states: 29

3. Upon sign-off from vessel for medical treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is declared fit to work or the degree
of his permanent disability has been assessed by the company-designated physician,
but in no case shall this period exceed one hundred twenty (120) days.

xxx

In case of permanent total or partial disability of the seafarer caused by either injury
or illness the seafarer shall be compensated in accordance with the schedule of
benefits enumerated in Section 30 of his Contract.

The respondents then point out that Section 30 provides a schedule of disability for injuries,
disease or illness contracted. Any item in the schedule classified under Grade I constitutes total
and permanent disability entitled to a disability allowance equivalent to US$60,000 (US$50,000 x
120%). They consider reliance on this Court's ruling in Crystal Shipping v. Natividad;30
Government Service Insurance System v. Cadiz;31 and Ijares v. Court of Appeals,32 to be
misplaced with respect to the advocated conversion of the petitioner's medical condition from
temporary to permanent disability.

ISSUE

WON petitioner is entitled to permanent total disability benefits?

RULING

No. The SC find no merit in the petition.

1. Entitlement to disability benefits by seamen on overseas work is a matter governed,

not only by medical findings but, by law and by contract.
● By statutory provisions are Articles 191 to 193 under Chapter VI (Disability
Benefits) of the Labor Code, in relation with Rule X of the Rules and Regulations
Implementing Book IV of the Labor Code.
● By contract, Department Order No. 4, series of 2000 of the Department of Labor
and Employment (the POEA Standard Employment Contract) and the parties'
CBA bind the seaman and his employer to each other.

Every seaman and the vessel owner (directly or represented by a local manning agency)
are required to execute the POEA Standard Employment Contract as a condition sine
qua non prior to the deployment for overseas work.
A notable feature of the POEA Standard Employment Contract is Section 31 - its provision on the
Applicable Law. It provides:

Thus, with the POEA Standard Employment Contract, there is no doubt that in case
of any unresolved dispute, claim or grievance arising out of or in connection with the
contract, Philippine laws shall apply.

In real terms, this means that the shipowner - an employer operating outside Philippine
jurisdiction - does not subject itself to Philippine laws, except to the extent that it concedes
the coverage and application of these laws under the POEA Standard Employment
Contract. On the matter of disability, the employer is not subject to Philippine jurisdiction in terms
of being compelled to contribute to the State Insurance Fund, the POEA Standard Employment
Contract provides its own system of disability compensation that approximates (and even
exceeds) the benefits provided under Philippine law.34

The standard terms agreed upon, as above pointed out, are intended to be read and understood
in accordance with Philippine laws, particularly, Articles 191 to 193 of the Labor Code and the
applicable implementing rules and regulations in case of any dispute, claim or grievance.

In this respect and in the context of the present case, Article 192(c)(1) of the Labor Code provides
that:

x x x The following disabilities shall be deemed total and permanent:

(1) Temporary total disability lasting continuously for more than one hundred twenty
days, except as otherwise provided in the Rules;

xxx

The rule referred to - Rule X, Section 2 of the Rules and Regulations implementing Book IV of
the Labor Code - states:

Period of entitlement. - (a) The income benefit shall be paid beginning on the first day
of such disability. If caused by an injury or sickness it shall not be paid longer than
120 consecutive days except where such injury or sickness still requires medical
attendance beyond 120 days but not to exceed 240 days from onset of disability in
which case benefit for temporary total disability shall be paid. However, the
System may declare the total and permanent status at anytime after 120 days of
continuous temporary total disability as may be warranted by the degree of actual
loss or impairment of physical or mental functions as determined by the System.
[Underscoring ours]

These provisions are to be read hand in hand with the POEA Standard Employment Contract
whose Section 20 (3) states:
 Upon sign-off from the vessel for medical treatment, the seafarer is entitled to
sickness allowance equivalent to his basic wage until he is declared fit to work or
the degree of permanent disability has been assessed by the company-designated
physician but in no case shall this period exceed one hundred twenty (120) days,
provided that:

● The seafarer, upon sign-off from his vessel, must report to the company-designated
physician within three (3) days from arrival for diagnosis and treatment.
● For the duration of the treatment but in no case to exceed 120 days, the seaman is on
temporary total disability as he is totally unable to work. He receives his basic wage during
this period until he is declared fit to work or his temporary disability is acknowledged by
the company to be permanent, either partially or totally, as his condition is defined under
the POEA Standard Employment Contract and by applicable Philippine laws.
● If the 120 days initial period is exceeded and no such declaration is made because the
seafarer requires further medical attention, then the temporary total disability period may
be extended up to a maximum of 240 days, subject to the right of the employer to declare
within this period that a permanent partial or total disability already exists.39
● The seaman may of course also be declared fit to work at any time such declaration is
justified by his medical condition.

2. He and the respondent company acted correctly in accordance with the terms of the
POEA Standard Employment Contract and the CBA;

Problems only arose when despite the certification, the petitioner sought second and third
opinions from his own doctors, one of whom opined that he could no longer resume work as a
pumpman while the other recognized a Grade X (20.15%) partial permanent disability. Based on
these opinions, the petitioner demanded that he be paid disability and sickness benefits; when
the company refused, the demand metamorphosed into an actual case before the NLRC
Arbitration Branch.

Viewed from this perspective, both the NLRC and CA were legally correct when they refused to
recognize any disability because the petitioner had already been declared fit to resume his duties.

The POEA Standard Employment Contract and the CBA clearly provide that when a seafarer
sustains a work-related illness or injury while on board the vessel, his fitness or unfitness for work
shall be determined by the company-designated physician. If the physician appointed by the
seafarer disagrees with the company-designated physician's assessment, the opinion of a third
doctor may be agreed jointly between the employer and the seafarer to be the decision final and
binding on them.40

Thus, while petitioner had the right to seek a second and even a third opinion, the final
determination of whose decision must prevail must be done in accordance with an
agreed procedure. Unfortunately, the petitioner did not avail of this procedure; hence, we
 have no option but to declare that the company-designated doctor's certification is the final
determination that must prevail.

This led the NLRC in its own ruling to note that:

x x x more weight should be given to the assessment of degree of disability made by

the company doctors because they were the ones who attended and treated
petitioner Vergara for a period of almost five (5) months from the time of his
repatriation to the Philippines on September 5, 2000 to the time of his declaration as
fit to resume sea duties on January 31, 2001, and they were privy to petitioner
Vergara's case from the very beginning, which enabled the company-designated
doctors to acquire a detailed knowledge and familiarity with petitioner Vergara's
medical condition which thus enabled them to reach a more accurate evaluation of
the degree of any disability which petitioner Vergara might have sustained. These
are not mere company doctors. These doctors are independent medical
practitioners who passed the rigorous requirements of the employer and are
more likely to protect the interest of the employer against fraud.

Moreover, as between those who had actually attended to petitioner Vergara

throughout the duration of his illness and those who had merely examined him later
upon his recovery for the purpose of determining disability benefits, the former must
prevail.

As a last point, the petitioner has repeatedly invoked our ruling in Crystal Shipping, Inc. v.
Natividad,41 apparently for its statement that the respondent in the case "was unable to perform
his customary work for more than 120 days which constitutes permanent total disability." This
declaration of a permanent total disability after the initial 120 days of temporary total disability
cannot, however, be simply lifted and applied as a general rule for all cases in all contexts. The
specific context of the application should be considered, as we must do in the application of all
rulings and even of the law and of the implementing regulations.

While the case was not clear on how the initial 120-day and subsequent temporary total
disability period operated, what appears clear is that the disability went beyond 240
days without any declaration that the seafarer was fit to resume work. Under the
circumstances, a ruling of permanent and total disability was called for, fully in
accordance with the operation of the period for entitlement that we described
above. Viewed from this perspective, the petitioner cannot cite the Crystal Shipping ruling
as basis for his claim for permanent total disability.

Additionally and to reiterate what we pointed out above regarding the governing rules that affect
the disability of Filipino seafarers in ocean-going vessels, the POEA Standard Employment
Contract provides its own Schedule of Disability or Impediment for Injuries Suffered and Diseases
Including Occupational Diseases or Illness Contracted (Section 32); Disability Allowances (a
subpart of Section 32); and its own guidelines on Occupational Diseases (Section 32-A) which
cannot be disregarded in considering disability compensation and benefits. All these - read in
relation with applicable Philippine laws and rules - should also be taken into account in considering
and citing Crystal Shipping and its related line of cases as authorities.

#4

G. R. No. 172800 October 17, 2008

MARCIANO L. MASANGCAY, petitioner,

vs.

TRANS-GLOBAL MARITIME AGENCY, INC. AND VENTNOR NAVIGATION, INC.,

respondents.

Ventnor (private respondent) is a foreign company based in Liberia and engaged in maritime
commerce. It is represented in the Philippines by its manning agent, and co-respondent herein,
Trans-Global, a corporation organized and existing under Philippine laws.

September 2, 2002- Ventnor, through its manning agent, hired petitioner Marciano Masangcay
as an oiler on M/T Eastern Jewel, an oil tanker for a period of 7 months.

September 23, 2002 (21 days later) - while on board M/T Eastern Jewel, Masangcay noticed a
reddish discoloration of his urine upon micturation (urination). This happened several times and
later became associated with bouts of left lower abdominal pain radiating to the loin area.

October 4, 2002 - Masangcay was brought to the Fujairah Hospital, Fujairah, United Arab
Emirates, because of lower abdominal pain and left loin pain of ten (10) days duration with
difficulty in urinating.
 Diagnosis of attending physician - suffering from renal failure due to multiple
renal stones on the left kidney with bilateral hydronephrosis with dilation of ureters and
pelvicalyceal system.

Recommended treatment - [L]eft nephrostomy or better removal of the

right pelvi-ureteric calculus

Masangcay refused surgical intervention and insisted on being repatriated back to the Philippines
instead.

October 7, 2002 – Petitioner was was immediately referred to Trans-Global’s designated

physician, Dr. Mary Ann D. Barrientos (Dr. Barrientos) for evaluation. She referred him to one of
the urologists at the Makati Medical Center.

October 21 until October 26, 2002- Masangcay was hospitalized at the MMC for the treatment
of his "Non-Functional Right Kidney and Left Pelvolithiasis.

During one of Masangcay’s subsequent follow-ups, his attending physician, requested a CT scan
of his upper abdomen to asses the status of his (Masangcay) right kidney. From the result,
removal of the non-functioning right kidney was advised but Masangcay refused.

Masangcay was then referred to Dr. Reynaldo C. de la Cruz of the National Kidney and Transplant
Institute (NKTI) for a second opinion. Said physician confirmed the need for another operation.
The medical procedures proved successful as evidenced by a repeat examination of Masangcay’s
urine, done on 8 January 2003, which yielded a negative result for the presence of blood.

January 29, 2002 - Dr. dela Cruz pronounced Masangcay fit to resume work as all his laboratory
examinations showed normal results.

January 30, 2002 - Trans-Global’s designated physician, Dr. Barrientos of the Associated
Medical & Clinical Services, Inc., declared Masangcay fit to go back to work after a regular
medical examination and pegged the disability period of the latter to be from 3 October 2002 until
3 February 2003.

Feb. 21, 2002 – Petitioner was paid his full 120 days Sick Leave pay of Ninety Five Thousand
Five Hundred Sixty Four and 52/100 (₱95,564.52) Pesos.

March 2003 - Masangcay was asked to report back to the office of Trans-Global for deployment
line-up. When Masangcay reported to the premises of Trans-Global, however, he was informed
by the Port Captain that he (Masangcay) can no longer be deployed due to negative reports about
him coming from its principal, Ventnor.

October 6, 2003 - Armed with a Medical Certificate issued by one Dr. Efren R. Vicaldo (Dr.
Vicaldo), a cardiologist, Masangcay instituted a complaint against Trans-Global and Ventnor
including Trans-Global’s President, Michael Estaniel, before the (NLRC) for the payment of
disability benefit, damages and attorney’s fees.
 Dr. Vicaldo’s Medical Certificate finds (among others) that:

- Impediment grade III (78.36%) hence,

- Petitioner is now unfit to resume work as seaman in any

capacity.

- His illness is considered work aggravated.

- He needs regular monitoring of his renal function for

deterioration and possible recurrence of kidney stones.

- He cannot land a gainful employment given his medical

background.

Petitioner’s Contention:

· claiming disability benefit under Section 20(b), paragraph 5 of the POEA

Revised Standard Terms and Conditions Governing the Employment of Filipino
Seafarers on Board Ocean-Going Vessels, as amended by Memorandum Circular
No. 55, Series of 1996, which is deemed integrated in every contract of
employment of Filipino seafarers on ocean-going vessels.

· alleged that his illness was contracted during the term of his Contract of
Employment.

Respondent’s rebuttal:

· his claim for disability benefits has no basis, since complainant had fully
recovered and was pronounced fit for employment

· the right to compensation for disability arises only when it is shown that the
seafarer is disabled on account of an illness or injury suffered while in the employ
of his employer

· the company-designated physician had certified that complainant is fit for

employment

· assuming arguendo but without admitting that their assessments and

findings, including Dr. Barrientos’, are disputed, however, under Sec. 20B, there
must be a third doctor chosen by both parties who should resolved the issue and
make a decision thereon"; and that "absent such determination, the complaint is
premature and without basis since it is that third doctor’s decision which will be
considered as final."

LABOR ARBITER - found Masangcay’s complaint meritorious and ordered Trans-Global,

Ventnor, and Estaniel to pay Masangcay
 Reason: Compensability of an ailment does not depend on whether or not the injury or
disease was pre-existing at the time of employment, but rather, if the injury or disease was
related to or was aggravated by Masangcay’s work.

The labor arbiter gave great weight to the medical opinion of Dr. Vicaldo
rather than that of Trans-Global’s designated physicians considering that "respondents’
accredited doctors’ opinion has more than meets the eye and should not be taken at face
value. For most often than not, they are palpably self-serving and bias in favor of the
employer and certainly cannot be considered independent.

On appeal, NLRC - the Commission affirmed the decision of the labor arbiter albeit with
modification dismissing the claim against Estaniel for the reason that Masangcay failed to
adduce evidence that the President of Trans-Global acted with malice and bad faith in denying
his (Masangcay) disability benefit claim.

Private Respondents filed an original action for certiorari before the Court of Appeals imputing
grave abuse of discretion amounting to lack or excess of jurisdiction on the NLRC for affirming
the decision of the labor arbiter.

Court of Appeals - granted the petition for certiorari nullifying and set aside the challenged
Resolutions of the NLRC for having been issued in grave abuse of discretion amounting to lack
or excess of jurisdiction.

Reason: 1. The NLRC arbitrarily set aside the fact that Masangcay was
precluded from any entitlement to disability benefits after he was already fully recovered
and declared to be fit for employment by the company-designated physician.

2. Under the Standard Terms, the right to compensation for

disability arises only when the seafarer has been disabled on account of his illness or
injury that he suffered while in the employ of his employer; otherwise, gross injustice would
result to the petitioners.

3. Generalizing that company-designated or company-referred

physicians were often biased in favor of the company and that their opinions were self-
serving without specifically indicating how their specific findings were biased and why such
opinions were self-serving. The generalization was, at the very least, most unfair to Dr.
Agustin and Dr. dela Cruz, specialists in urology that covered the ailment of Masangcay.

Such company-designated or company-referred physicians had

themselves personally attended to, examined and treated Masangcay in a professional
capacity. Thereby, their findings and conclusions were far from speculation and
conjecture.
 4. The NLRC did not require the opinion of a third doctor after Dr.
Vicaldo (as Masangcay’s chosen physician) had disagreed with the findings and opinions
of the company-designated physician. As needed in the face of the clear requirement of
Sec. 20B, Standard Terms:

"If a doctor appointed by the seafarer disagrees with the

assessment, a third doctor may be agreed jointly between the employer and the
seafarer. The third doctor’s decision shall be final and binding on both parties."

Masangcay’s motion for reconsideration was denied by the Court of Appeals in a Resolution dated
30 May 2006.

Issue The fundamental issue to be resolved in this petition is whether or not Masangcay is
entitled to disability benefits on account of his present condition

Petitioner: 1. Masangcay argued that since his "disability" lasted for more than
120 days, he is deemed to be already permanently disabled.

2. Citing Crystal Shipping, Inc. v. Natividad,38Masangcay made a case that "in

compensation proceedings, the fitness or unfitness of a seafarer should not be construed
in its medical significance but rather on the inability of the seafarer to perform his
customary work.

3. That he is entitled to disability benefits, Sec. 20(b), paragraph 5 of the Philippine

Overseas Employment Administration (POEA) Revised Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels,
integrated in his contract of employment.

Respondents: 1. The POEA Standard Employment Contract determines the

liability and extent of liability of the employer in case of an injury or illness contracted by a
seafarer.

As set forth in Sec. 20(b) of the POEA Standard Employment Contract, the
employer-vessel owner/principal shall be liable for disability benefits to the seafarer only
in case the latter was declared disabled by the company designated physician in view
of a work-related illness or injury that he suffered onboard the vessel.

Since petitioner-seafarer was declared FIT TO WORK by the company designated

physician, clearly then he is not entitled to disability benefits under the POEA Standard
Employment Contract."
 2. With respect to the Crystal Shipping case referred to by Masangcay, Trans-Global and
Ventnor refute such citation as the facts and circumstances present in said case are not
herein availing.

Held: We rule in the negative. We rule in favor of Trans-Global and Ventnor

The Court anchored the ruling on the following:

1. Standard Terms and Conditions Governing the Employment of Filipino Seafarers on

Board Ocean-Going Vessels

2. The burden to prove disability.

3. Chronic renal failure not covered by compensation and benefit under permanent
disability

4. Inapplicability of the case of Crystal Shipping, Inc. v. Natividad

(Discussions on: Standard Terms and Conditions Governing the Employment of Filipino
Seafarers on Board Ocean-Going Vessels and Burden of proof)

A. Standard Terms and Conditions Governing the Employment of Filipino Seafarers on

Board Ocean-Going Vessels

As with all other kinds of worker, the terms and conditions of a seafarer’s employment is governed
by the provisions of the contract he signs at the time he is hired.

But unlike that of others, deemed written in the seafarer’s contract is a set of standard
provisions set and implemented by the POEA, called the Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels, which are
considered to be the minimum requirements acceptable to the government for the employment of
Filipino seafarers on board foreign ocean-going vessels.

The issue of whether Masangcay can legally demand and claim disability benefits from Trans-
Global and Ventnor for an illness that became apparent during his contract of employment with
the shipping company, is governed by the provisions of the POEA Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels.

Considering that Masangcay was employed on 3 September 2002, it is the 2000 POEA Amended
Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board
Ocean-Going Vessels that is considered appended in his contract of employment and is
controlling for purposes of resolving the issue at hand.

Note: Masangcay suggested that 1996 POEA Revised Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels should
be controlling for the purpose of resolving the issue.

Under Sec. 20(b), paragraph 6, of the 2000 POEA Amended Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean- Vessels, viz:

SECTION 20. COMPENSATION AND BENEFITS

COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS

The liabilities of the employer when the seafarer suffers work-related injury or
illness during the term of his contract are as follows:

xxxx

6. In case of permanent total or partial disability of the seafarer caused by

either injury or illness the seafarer shall be compensated in accordance
with the schedule of benefits enumerated in Section 32 of this Contract.
Computation of his benefits arising from an illness or disease shall be
governed by the rates and the rules of compensation applicable at the time
the illness or disease was contracted. [Emphasis supplied.]

Evident from the afore-quoted provision is that the permanent total or partial disability suffered by
a seafarer during the term of his contract must be caused by work-related illness or injury. In other
words, to be entitled to compensation and benefits under said provision, it is not sufficient
to establish that the seafarer’s illness or injury has rendered him permanently or partially disabled,
but it must also be shown that there is a causal connection between the seafarer’s illness
or injury and the work for which he had been contracted for.

Accordingly, Masangcay must prove that he is suffering from permanent total or partial disability
due to a work-related illness occurring during the term of his contract. Proof that he not only
acquired or contracted his illness during the term of his employment contract is clearly not enough;
Masangcay must also present evidence that such infirmity was work-related, or at the very
least aggravated by the conditions of the work for which he was contracted for.

B. Burden of proof

Court cited the case of Riño v. Employees’ Compensation Commission "a claimant must
submit such proof as would constitute a reasonable basis for concluding either that the conditions
of employment of the claimant caused the ailment or that such working conditions had aggravated
the risk of contracting that ailment. What kind and quantum of evidence would constitute an
adequate basis for a reasonable man {not necessarily a medical scientist} to reach one or the
other conclusion, can obviously be determined only on a case-to-case basis. That evidence must,
however, be real and substantial, and not merely apparent; for the duty to prove work-causation
or work-aggravation imposed by existing law is real x x x not merely apparent."

The burden is clearly upon Masangcay to present substantial evidence, or such relevant
evidence which a reasonable mind might accept as adequate to justify a conclusion, showing a
reasonable connection that the nature of his employment or working conditions between the
conditions of his work and his illness, i.e., renal failure, uremia42 and/or nephrolithiasis43; or that
the risk of contracting the same was increased by his working conditions. This, he did not do.

- Masangcay does not even assert that his illness is work-related and/or
was, at the minimum, aggravated by his working conditions at the M/T Eastern
Jewel.

- His medical history and/or records prior to his deployment as an oiler in

M/T Eastern Jewel were neither presented nor alluded to in order to
demonstrate that the working conditions on board said vessel increased the
risk of contracting renal failure, chronic or otherwise.

(Discussions on: Chronic renal failure not covered by compensation and benefit under
permanent disability)

A. Chronic renal failure is described as a result of progressive and irreversible

destruction of nephrons, regardless of cause (Citing Harrison’s Principles of Internal Medicine).
This diagnosis implies that glomerular filtration rate (GFR) is known to have been reduced for at
least 3 to 6 months. It is, therefore, highly improbable that Masangcay’s chronic renal failure
developed in just a month’s time, the length of time he was on board M/T Eastern Jewel before
the symptoms became manifest.

Passing Masangcay’s pre-employment medical examination is immaterial. The

decrease of GFR, which is an indicator of chronic renal failure, is measured thru the renal function
test. -In pre-employment examination, the urine analysis (urinalysis), which is normally included,
measures only the creatinine, the presence of which cannot conclusively indicate chronic renal
failure.

2. Chronic renal failure is neither listed as a disability under:

a. Sec. 32 of the 2000 POEA Amended Standard Terms and Conditions

Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels
- it is the loss of a kidney, i.e., its removal, that is compensated, and not merely the
presence and subsequent removal of kidney stones.
 b. nor occupational disease under Sec. 32-A thereof, which provides for the
schedule of disability or impediment for injuries suffered and diseases including
occupational diseases or illness.

SECTION 32-A. OCCUPATIONAL DISEASES

For an occupational disease and the resulting disability or
death to be compensable, all of the following conditions
must be satisfied:
(1) The seafarer’s work must involve the risks described
herein;
(2) The disease was contracted as a result of the
seafarer’s exposure to the described risks;
(3) The disease was contracted within a period of exposure
and under such other factors necessary to contract it;
(4) There was no notorious negligence on the part of the
seafarer.

(Discussions on: Citing Crystal Shipping, Inc. v. Natividad)

Petitioners contention: Citing Crystal Shipping, Inc. v. Natividad that "in disability compensation,
it is not the injury which is compensated, but rather it is the incapacity to work resulting in the
impairment of one’s earning capacity," hence, he is entitled to disability benefits under his contract
of employment.

Court ruled: We are not persuaded. Masangcay cannot invoke a single line declared by this
Court in another case under a totally different factual context.

The Court distinguished the case of Crystal Shipping from Masangcay’s case.

Although the similarity between two cases, is the fact that the seafarers in
both have the same personal physician, Dr. Efren R. Vicaldo, a cardiologist, who declared them
permanently disabled to return to work. (Similarity)

Their Difference

Crystal Shipping, Inc. v. Natividad –

· there was no question as whether or not the seafarer

is entitled to disability benefits as in fact Crystal Shipping, et
al. offered to pay disability benefits.

· The only issue therein referred to the degree of

disability and impediment grade to which the seafarer was
to be classified; or, put simply, how much disability benefit
was he entitled to.
 Masangcay’s case (This petition) –

· Trans-Global and Ventnor are contesting the right of

Masangcay to claim disability benefits as the company-
designated physicians have certified the latter fit to return to
work, not to mention the fact that he was not suffering from
a work-related and/or work-aggravated illness.

The Court mentioned that the issue could have been resolved had the parties stayed true to the
provisions of Sec. 20(b), paragraph 3 of the 2000 POEA Amended Standard Terms and
Conditions, which declares that:

SECTION 20. COMPENSATION AND BENEFITS

xxxx

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS

The liabilities of the employer when the seafarer suffers work-related

injury or illness during the term of his contract are as follows:

xxxx

3. Upon sign-off from the vessel for medical treatment , the seafarer is
entitled to sickness allowance x x x until he is declared fit to work or the
degree of permanent disability has been assessed by the company-
designated physician x x x

xxxx

If a doctor appointed by the seafarer disagrees with the assessment, a third

doctor may be agreed jointly between the Employer and the seafarer. The
third doctor’s decision shall be final and binding on both parties.

Without the opinion of a third doctor, we are constrained to make a ruling based on the evidences
submitted by the parties and made part of the records of this case, which included the medical
certifications of their respective physicians.

All told, except for the bare assertion that he is no longer fit to work due to the illness that became
manifest during his contract of employment with Trans-Global and Ventnor, Masangcay makes
no allegation, much less presents no proof, that the illness was caused or aggravated by
his employment. The evidence on record is totally bare of essential facts on how he contracted
or developed such disease and on how and why his working conditions increased the risk of
contracting the same. Consequently, the labor arbiter and the NLRC had no basis at all to rule
that Masangcay is deserving of other disability benefits espoused by Sec. 20(b), paragraph 6 of
the 2000 POEA Amended Standard Terms and Conditions other than that already extended to
him by Trans-Global and Ventnor.

Petition Denied. Masangcay was not entitled to anything more than what he was already paid by
the petitioners.

#5

G.R. No. 182430 December 4, 2009

LEOPOLDO ABANTE, Petitioner,

vs.
KJGS FLEET MANAGEMENT MANILA and/or GUY DOMINGO A. MACAPAYAG, KRISTIAN GERHARD
JEBSENS SKIPSRENDERI A/S, Respondents.

January 4, 2000 - Petitioner was hired by respondent KJGS Fleet Management Manila (KJGS) to work as
ablebodied seaman aboard M/T Rathboyne, for a period of nine months.

June 2000 - Petitioner slipped and hurt his back, while carrying equipment on board the vessel.

July 4, 2000 - Petitioner was brought to a hospital in Kaohsiung, Taiwan whereupon he was diagnosed to be
suffering from "lower back pain r/o old fracture lesion 4th lumbar body."

He was still declared to be fit for restricted work and was advised to see another doctor in the next port of call.

July 19, 2000 - Petitioner was, on his request, repatriated to the Philippines because he was unable to bear the pain

July 21, 2000 - Petitioner reported to KJGS and was referred to a company-designated physician, Dr. Roberto D. Lim (Dr. Lim). After
a series of tests, he was diagnosed to be suffering from "Foraminal stenosis L3-L14 and central disc protrusion L4-L5"

August 18, 2000 - Petitioner underwent Laminectomy and Discectomyon. He was discharged from the hospital 10 days later, but
was advised to continue physical therapy.

August 18, 2000 – February 20, 2001 - He was seen by Dr. Lim around 10 times. On the 20th he was pronounced fit to resume sea
duties. However, he refused to sign his Certificate of Fitness for Work.

Petitioner later sought the opinion of another doctor, Dr. Jocelyn Myra R. Caja, who diagnosed him to have "failed back syndrome"
and gave a grade 6 disability rating - which rating rendered him medically unfit to work again as a seaman and called for the award of
US$25,000.00 disability benefits. Because of this, on April 27, 2001, he filed a Complaint before the NLRC for disability compensation
in the amount of US$25,000.00, moral and exemplary damages and attorney’s fees

Labor Arbiter - dismissed the complaint

Reason: petitioner’s immediate filing of the complaint, insisting on his own physician’s assessment, was premature and,
therefore, the assessment of the company-designated physician that he is still fit to work prevails. (Based on POEA Memo Circular
No.9 of 2000 – “in the event of conflict between the assessment of the company-designated physician and the doctor chosen by the
seafarer, the opinion of a third doctor agreed on by both the employer and the seafarer should be sought.”)

NLRC - Ordered the remand of the case to the Labor Arbiter for further proceedings.

Reason: The matter must be referred to a third doctor to determine his entitlement to disability benefits since there were
two conflicting diagnoses as to petitioner’s fitness to work. (Based on the new POEA Standard Employment Contract for seafarers)

Respondent’s Motion for Reconsideration was denied, hence it appealed to the C.A.

Court of Appeals - reversed and set aside the NLRC ruling and reinstated the Labor Arbiter’s Decision.

Reason: - Sec. 20 (B) of POEA Memo Circular No. 9, series of 2000, which requires a third doctor in case of conflicting
assessments, is inapplicable.

Note: The employment contract between KJGS and petitioner was executed on January 4, 2000.

It held that the contract is governed by Memo Circular No. 55, series of 1996, which did not have a similar provision with
series of 2000, hence, it is the determination or assessment of the company-designated physician which is deemed controlling.

Petitioner’s MR denied.

Contention of Petitioner: He is entitled to Grade 6 disability benefits under the new POEA Standard Employment Contract.
Issue: Whether or not petitioner is entitled to disability benefits.

Held: Yes.

Section 20 (B) (3) of the POEA Standard Employment Contract of 2000 provides:

SECTION 20. COMPENSATION AND BENEFITS FOR INJURY AND ILLNESS

The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract
are as follows:

xxxx

3. Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent
to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the
company-designated physician but in no case shall this period exceed one hundred twenty (120) days.

For this purpose, the seafarer shall submit himself to a post-employment medical examination by a company-
designated physician within three working days upon his return except when he is physically incapacitated to do
so, in which case, a written notice to the agency within the same period is deemed as compliance. Failure of the
seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the
above benefits.

If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between
the Employer and the seafarer. The third doctor’s decision shall be final and binding on both parties.

Clearly, the above provision does not preclude the seafarer from getting a second opinion as to his condition for purposes of claiming
disability benefits as held in NYK-Fil Ship Management v. Talavera:

This provision substantially incorporates the 1996 POEA Standard Employment Contract. Passing on the 1996 POEA
Standard Employment Contract, this Court held that "[w]hile it is the company-designated physician who must declare
that the seaman suffers a permanent disability during employment, it does not deprive the seafarer of his right to
seek a second opinion," hence, the Contract "recognizes the prerogative of the seafarer to request a second opinion and,
for this purpose, to consult a physician of his choice."

In the present case, it is undisputed that petitioner immediately consulted with a physician of his choice after initially having been seen
and operated on by a company-designated physician. It was after he got a second opinion and a finding that he is unfit for further work
as a seaman that he filed the claim for disability benefits.

POEA MEMO CIRCULAR NO. 9, SERIES OF 2000 is APPLICABLE (contrary to the contention of CA)

The ruling in Seagull Maritime Corporation v. Dee is applied in this case involving employment contract entered into in 1999, before
the promulgation of POEA Memo Circular No. 9, series of 2000 or the use of the new POEA Standard Employment Contract, like that
involved in the present case.

In said case, the Court applied the 2000 Circular in holding that while it is the company-designated physician who must
declare that the seaman suffered permanent disability during employment, it does not deprive the seafarer of his right to seek a second
opinion which can then be used by the labor tribunals in awarding disability claims.

Courts are called upon to be vigilant in their time-honored duty to protect labor, especially in cases of disability or ailment.
When applied to Filipino seamen, the perilous nature of their work is considered in determining the proper benefits to be awarded.
These benefits, at the very least, should approximate the risks they brave on board the vessel every single day.

If serious doubt exists on the company-designated physician’s declaration of the nature of a seaman’s injury and its
corresponding impediment grade, resort to prognosis of other competent medical professionals should be made. In doing so, a
seaman should be given the opportunity to assert his claim after proving the nature of his injury. These evidences will in turn be used
to determine the benefits rightfully accruing to him.
 It is understandable that a company-designated physician is more positive than that of a physician of the seafarer’s choice.
It is on this account that a seafarer is given the option by the POEA Standard Employment Contract to seek a second opinion from
his preferred physician.

In HFS Philippines v. Pilar, where the findings of the independent physicians were given more credence than those of the
company-designated physicians, the Court held:

The bottomline is this: the certification of the company-designated physician would defeat respondent’s claim while the
opinion of the independent physicians would uphold such claim. In such a situation, we adopt the findings favorable to
respondent.

PETITIONER CAN CLAIM DISABILITY BENEFIT

Permanent disability refers to the inability of a worker to perform his job for more than 120 days, regardless of whether he
loses the use of any part of his body. What determines petitioner’s entitlement to permanent disability benefits is his inability to work
for more than 120 days.

In the case at bar, it was only on February 20, 2001 that the Certificate of Fitness for Work was issued by Dr. Lim, more
than 6 months from the time he was initially evaluated by the doctor on July 24, 2000 and after he underwent operation on August 18,
2000

From July 24, 2000 up to February 20, 2001 or a total of 13 timesDr. Lim consistently recommended that petitioner continue
his physical rehabilitation/therapy and revisit clinic on specific dates for re-evaluation, thereby implying that petitioner was not yet fit
to work.

Given a seafarer’s entitlement to permanent disability benefits when he is unable to work for more than 120 days, the failure
of the company-designated physician to pronounce petitioner fit to work within the 120-day period entitles him to permanent total
disability benefit in the amount of US$60,000.00.

MORAL and EXEMPLARY DAMAGES not granted

No concrete showing of bad faith or malice on the part of KJGS. The records show that it shouldered all the expenses
incurred in petitioner’s surgery and subsequent rehabilitation. And it regularly inquired from Dr. Lim about petitioner’s condition

Respondents are held jointly and severally liable to pay petitioner the following: a) permanent total disability benefits of US$60,000.00
at its peso equivalent at the time of actual payment; and b) attorney's fees of ten percent (10%) of the total monetary award at its peso
equivalent at the time of actual payment.

#6

CARLOS N. NISDA, Petitioner,

vs.

SEA SERVE MARITIME AGENCY and KHALIFA A. ALGOSAIBI DIVING AND MARINE SERVICES,Respondents.

Nobel ( Nobel Ship Services, Inc.)

is a corporation organized and existing under Philippine Laws. It used
to be the representative in the Philippines and manning agent of respondent ADAMS, a foreign
company based in the Kingdom of Saudi Arabia and engaged in maritime commerce.

Aug. 7, 2001 - Petitioner Nisda was hired by ADAMS, through its manning agent, Nobel, as Tugboat Master on M/V Algosaibi-
21(Vessel)
 - - continuation of [three] 3
Petitioner Nisda’s employment was to run for a period of "[six] 6 months
months remaining , under the terms and conditions approved by the POEA

Aug. 22, 2001 - Petitioner Nisda joined the vessel M/V Algosaibi-21 at the port of Rastanura, Kingdom of Saudi
Arabia.

Aug. 30, 2001 - While on board the vessel M/V Algosaibi-21, it appeared that petitioner Nisda and a representative of respondent
ADAMS entered into a second contract of employment

The aforementioned contract contained a stipulation stating:

Section – 10

It is mutually agreed that this contract cancels and supersedes all agreements, contracts and commitments
prior to the date hereof (if any) and that after the execution of this contract neither party shall have any Right,
Privilege or Benefit other than as mentioned above, except for the Employee’s right to an end-of-service award
("Service Indemnity") which shall be calculated from the date specified in Section 2 Para y).

The abovequoted contract of employment was neither processed nor sanctioned by the POEA.

- petitioner Nisda again left the Philippines for Gizan, Kingdom of Saudi Arabia,
On 9 December 2001
in order to embark on the vessel M/V Algosaibi-22. His embarkation was made in fulfillment of his
contractual obligation pursuant to the 7 August 2001 POEA-SEC he signed with respondent
ADAMS.

the day
According to the pertinent pages of his Seaman’s Book, petitioner Nisda’s latest deployment lasted until 7 March 2002
he again disembarked from the vessel M/V Algosaibi-22 at the port of Gizan, Kingdom of Saudi
Arabia.

The very next day,8 March 2002, petitioner embarked, on another vessel, M/V Algosaibi-42, this time, at the port of Tanjib, Kingdom
of Saudi Arabia.

May 5, 2002 - petitioner was brought to the Dar Al-Ta’afi Medical Services complaining of "pain of parascapular region of 6 months
duration [with] paresthesia and numbness of both upper limbs."

Physician diagnosis: Nisda was diagnosed to be suffering from "Myositis of Parascapular (indistinct symbol) [with]
Paresthesia on upper limbs." When examined, petitioner Nisda’s blood pressure turned out to be 160/100 mm/Hg; thus, he
was advised to follow-up "for BP taking regularly.

17 July 2002 – Reptriated. Within three days from his arrival in the Philippines, petitioner Nisda claimed to have presented himself
at the office of Nobel for the requisite post-employment medical examination.

Test was conducted which impressed upon petitioner Nisda the necessity of a bypass operation. Hence, underwent
a triple [coronary artery] bypass surgery

A couple of months thereafter, petitioner Nisda obtained a medical certificate from a certain Dr. Levi Rejuso, an internist who
specialized in neurology, declaring that:

“he is refrained (sic) from doing stressful activities. In this regard he can no longer perform his duties as a Ship
Master and is categorized with grade 1 disability.”
 – Petitioner filed before NLRC for failure to pay disability benefits, illness allowance
16 January 2003
as well as medical expenses. (Alleging that "while under contract on board and on vacation pay
he was medically ill,” with "severe coronary heart disease, etc.)

Petitioner’s Contention: anchored his claim for disability benefit on Section (Sec.) 20(B), paragraph 6 of his POEA-SEC,
which, as earlier mentioned, incorporated the 2000 Amended Standard Terms and Conditions Governing the Employment
of Filipino Seafarers on Board Ocean-Going Vessels,

Respondents’’ contention:

- The illness benefits being claimed by the complainant are not compensable under the POEA Standard
Contract as they occurred after the expiration of the complainant’s employment contract

- the foreign principal already remitted the payment for the medical expenses of the complainant

- Guerrero was not personally liable for the complainant’s alleged claims

NLRC – Favored petitioner

Reason:

· The Labor Arbiter found that there was no doubt that petitioner Nisda’s heart condition was contracted
during his 15 long years of employment with respondent ADAMS.

· Factors of said employment, i.e., 12-hour work days and the different weather conditions he was exposed
to, predisposed said seafarer to heart disease.

· In ruling that petitioner Nisda suffered from a permanent disability with a Grade 1 disability or impediment
38
rating, the Labor Arbiter relied on the Certification issued by Dr. Levi Rejuso, a neurologist

Memorandum of Appeal before NLRC filed by respondents:

1. Petitioner Nisda’s heart ailment was diagnosed long after his 7 August 2001 POEA-SEC expired on 21
September 2002, so he was no longer entitled to disability benefits under said contract.

2. Petitioner Nisda likewise could not claim any benefits under his 30 August 2001 employment contract, which
he signed directly with respondent ADAMS, and which had no force and effect in this jurisdiction absent the prior
approval of the POEA.

Third Division of the NLRC - ruling in favor of respondents

Reasons:

· in order for an employer to be held liable to the seafarer on account of the latter’s illness,
the cause thereof must arise during the term of a duly approved POEA contract, which obviously
did not happen in the case at bar.

· complainant violated the Rules and Regulations of the POEA by entering into a contract
exceeding 12 months.

· He even deceived respondent Nobel by deliberately executing another contract without its
consent and sans any approval from the POEA.

Petitioner Nisda’s subsequent Motion for Reconsideration was denied by the NLRC for lack of merit

CA - dismissed petitioner Nisda’s Petition for Certiorari for lack of merit.

 Reasons:

· Petitioner Nisda] is claiming compensation for an illness suffered beyond the effectivity and enforceability
of the POEA approved contract.

· Neither can the petitioner invoke the existence of the second contract to hold the respondents liable to his
claims pursuant to the provisions of POEA-SEC. The said contract was executed in violation of the POEA Rules
and Regulations.

Issue: Whether or not Nisda’s heart condition is non-compensable.

Held: No. It is compensable.

Petitioner’s Contention:

· He was certified by the Dar al Ta’afi Medical Services Co. Ltd. [o]n May 5, 2002 which was within
the term or duration of his contract of his POEA approved contract of employment that was then set to
expire on May 2, 2002

Respondent’s Contention:

· Petitioner Nisda cannot base his claim for disability benefits under Sec. 20(B) of his 7 August
2001 POEA-SEC, because "this section specifically provides for the liabilities of the employer for an
injury or illness suffered by a seaman during the term of his contract."

· Since "petitioner filed disability claims for injuries suffered after the expiration of the first contract
[i.e., the 7 August 2001 POEA-SEC],"6
"the NLRC correctly ruled that it cannot
acquire jurisdiction over claims arising out of contracts without the
necessary approval of the POEA [i.e., the subsequent 30 August 2001
employment contract]."

We rule that petitioner Nisda is entitled to disability benefits.

CORONARY ARTERY DISEASE manifested by Petitioner

The issue of whether petitioner Nisda can legally demand and claim disability benefits from respondents Sea Serve and ADAMS for
an illness suffered is best addressed by the provisions of his POEA-SEC, which incorporated the Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels. When petitioner Nisda was employed on 7 August
2001, it was the 2000 Amended Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-
Going Vessels63(hereinafter referred to simply as Amended Standard Terms and Conditions for brevity) that applied and were deemed
written in or appended to his POEA-SEC.

Sec. 20(B), paragraph 6, of the 2000 Amended Standard Terms and Conditions provides:

SECTION 20. COMPENSATION AND BENEFITS

xxxx

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS

The liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his
contract are as follows:

xxxx
 6. In case of permanent total or partial disability of the seafarer caused by either injury or illness the seafarer shall
be compensated in accordance with the schedule of benefits enumerated in Section 32 of this Contract.
Computation of his benefits arising from an illness or disease shall be governed by the rates and the rules of
compensation applicable at the time the illness or disease was contracted. (Emphasis supplied.)

Pursuant to the afore-quoted provision, two elements must concur for an injury or illness to be compensable. First, that the injury or
illness must be work related; and second, that the work-related injury or illness must have existed during the term of the seafarer’s
employment contract.

The 2000 POEA Amended Standard Terms and Conditions defines "work-related injury" as "injury(ies) resulting in disability or death
arising out of and in the course of employment" and "work-related illness" as "any sickness resulting to disability or death as a result
of an occupational disease listed under Section 32-A of this contract with the conditions set therein satisfied," that is –

SECTION 32-A. OCCUPATIONAL DISEASES

For an occupational disease and the resulting disability or death to be compensable, all of the following conditions must be
satisfied:

1) The seafarer’s work must involve the risks described herein;

2) The disease was contracted as a result of the seafarer’s exposure to the described risks;

3) The disease was contracted within a period of exposure and under such other factors necessary to contract it;

4) There was no notorious negligence on the part of the seafarer.

Sec. 32-A(11) of the 2000 POEA Amended Standard Terms and Conditions explicitly considers Cardio-Vascular Disease as an
occupational disease if the same was contracted under working conditions that involve any of the following risks –

a) If the heart disease was known to have been present during employment, there must be proof that an acute exacerbation
was clearly precipitated by the unusual strain by reasons of the nature of his work.

b) The strain of the work that brings about an acute attack must be sufficient severity and must be followed within 24 hours
by the clinical signs of cardiac insult to constitute causal relationship.

c) If a person who was apparently asymptomatic before being subjected to strain at work showed signs and symptoms of
cardiac injury during the performance of his work and such symptoms and signs persisted, it is reasonable to claim a causal
relationship.

Consequently, for Cardio-Vascular Disease to constitute an occupational disease for which the seafarer may claim compensation, it
is incumbent upon said seafarer to show that he developed the same under any of the three conditions identified above.

In the present case, petitioner Nisda was diagnosed to be suffering from a Cardio-Vascular Disease, specifically, a Coronary Artery
Disease, only shortly after disembarking from M/V Algosaibi-42 and arriving in the Philippines. Petitioner Nisda’s disease was serious
enough to necessitate a Triple Bypass Operation on his heart.

According to the National Heart Lung and Blood Institutes of the National Institutes of Health, the
primary medical research
agency of the United States of America, coronary artery disease is a condition in which plaque
builds up inside the coronary arteries. These arteries supply the heart muscle with oxygen-rich
blood. When the coronary arteries are narrowed or blocked, oxygen-rich blood cannot reach the
heart muscle. This can cause angina, a feeling of pain in the chest area or discomfort that occurs
when not enough oxygen-rich blood is flowing to an area of the heart muscle. It may also feel like
pressure or squeezing in the chest which can be felt in the shoulders, arms, neck, jaw, or back.
Generally, the pain tends to get worse with activity and go away with rest. Or a heart attack, which
can occur when blood flow to an area of the heart muscle is completely blocked. When oxygen-
rich blood is prevented from reaching a specific area of the heart muscle, the tissue of the affected
area can die. Another common symptom of the disease is shortness of breath, due to fluid build
up in the lungs in the event of heart failure or when the heart cannot pump enough blood
throughout the body.

The severity of these symptoms varies. The symptoms may get more severe as the buildup of plaque continues to narrow the coronary
arteries. Some people who have coronary artery disease, however, have no signs or symptoms, and the disease may be left
undiagnosed until a person shows signs and symptoms of a heart attack, heart failure, or arrhythmia.

We observe that the physical discomforts of petitioner Nisda, for which he sought medical attention as early as 5 May 2002 when
he was brought to the clinic in Saudi Arabia, bear the hallmarks of coronary artery disease. Such disease does not develop
overnight. The plaque in the coronary arteries would have taken months, if not years, to build up, making it highly probable that
petitioner Nisda already had the disease during the life of his POEA-SEC, although it went undiagnosed because he had yet to
experience the symptoms.

In Seagull Shipmanagement and Transport, Inc. v. National Labor Relations Commission:

· We awarded benefits to the heirs of the seafarer therein who worked as a radioman on board a vessel; and
who, after ten months from his latest deployment, suffered from bouts of coughing and shortness of breath,
necessitating open heart surgery. We found in said case that the seafarer’s work exposed him to different climates
and unpredictable weather, which could trigger a heart attack or heart failure.

· We likewise ruled in said case that the seafarer had served the contract for a significantly long amount of
time, and that his employment had contributed, even to a small degree, to the development and
exacerbation of his disease.

reveal that petitioner Nisda had been deployed by respondent ADAMS

In the instant case, records
numerous times in a span of 15 years, under several employment contracts. Petitioner Nisda was
first hired and deployed by respondent ADAMS as a Tug Boat Master in 1987. He was
immediately hired and deployed again by respondent ADAMS after the expiration of each
employment contract. Through the years, petitioner Nisda worked for respondent ADAMS
essentially under the same or closely similar conditions, i.e., 48-hour work weeks with a maximum
of 105 hours of overtime.

As a defense against any liability, respondents Sea Serve and ADAMS incessantly posit that petitioner Nisda’s POEA-SEC had
already expired when the latter was repatriated to the Philippines on 17 July 2002 and subsequently diagnosed with Coronary Artery
Disease.

We disagree.

To be sure, the duration of petitioner Nisda’s POEA-SEC was "6 MONTHS – Continuation of 3 months," or nine months entirely.
Petitioner Nisda signed his POEA-SEC on 7 August 2001; but per Sec. 2(A) of the same, it was to commence only on 22 August
2001, the date of petitioner Nisda’s actual departure from the airport in the point of hire, which was Quezon City, carrying with him his
POEA-approved employment contract. The period of nine months, counted from 22 August 2001, expired on 21 May 2002.

However, Sec. 2(A) of the POEA-SEC also provides that the POEA-SEC shall be effective until the seafarer’s date of arrival at the
point of hire upon termination of the employment contract, pursuant to Sec. 18 of the same contract. Sec. 18 states –

SECTION 18. TERMINATION OF EMPLOYMENT

A. The employment of the seafarer shall cease when the seafarer completes his period of contractual service aboard the
vessel, signs-off from the vessel and arrives at the point of hire.

Record of the present case reveals that petitioner Nisda signed off and disembarked from M/V Algosaibi-42, and was repatriated to
the Philippines, only on 17 July 2002. Hence, it was only on said date that petitioner Nisda’s POEA-SEC actually concluded.
We cannot subscribe to the assertion of respondents Sea Serve and ADAMS that from 21 May 2002 until his repatriation on 17 July
2002, petitioner Nisda was already toiling under the provisions of the second employment contract he signed with respondent ADAMS
without the endorsement of the POEA.

In Placewell International Services Corporation v. Camote, we held that

“the subsequently executed side agreement of an overseas contract worker with the foreign employer is void,
simply because it is against our existing laws, morals and public policy. The subsequent agreement cannot
supersede the terms of the standard employment contract approved by the POEA. Republic Act No. 8042,
commonly known as the Migrant Workers Act of 1995, expressly prohibits the substitution or alteration, to the
prejudice of the worker, of employment contracts already approved and verified by the Department of Labor and
Employment (DOLE) from the time of the actual signing thereof by the parties up to and including the period of
the expiration of the same, without the approval of DOLE. Since the second employment contract petitioner Nisda
signed with respondent ADAMS was void for not having been sanctioned by the POEA, then petitioner Nisda’s
employment with respondent ADAMS was still governed by his POEA-SEC until his repatriation to the Philippines
on 17 July 2002.”

That petitioner Nisda was diagnosed with heart disease only on 19 July 2002, already two days after his return to the Philippines, is
of no adverse significance to his claim. Sec. 20(B)(3) of the 2000 POEA Amended Standard Terms and Conditions requires that a
seafarer, signing off from the vessel for medical treatment, must submit himself to a post-employment medical examination by a
company-designated physician within three working days upon his return

All told, the evidence, including medical documentation, presented by petitioner Nisda, substantially proved that a reasonable
connection existed between the work he performed for respondent ADAMS and the development and exacerbation of his Coronary
Artery Disease, hence, making it an occupational disease, as described and compensated for by Sec. 32-A of the 2000 POEA
Amended Standard Terms and Conditions. Consequently, it was erroneous for the NLRC and the Court of Appeals to deny petitioner
Nisda’s claims for disability benefits under Sec. 20(B), paragraph 6 of the 2000 POEA Amended Standard Terms and Conditions.

WHEREFORE, premises considered, the instant Petition is GRANTED. The assailed Decision dated 27 September 2006 and
Resolution 10 August 2006 of the Court of Appeals in CA-G.R. SP No. 87562 are REVERSED and SET ASIDE. The Decision dated
23 July 2003 of the Labor Arbiter, as amended by the Order dated 30 September 2003, in NLRC OFW Case No. (M) 03-01-0159-00
is AFFIRMED with MODIFICATION. Respondents Sea Serve Maritime Agency and Khalifa A. Algosaibi Diving and Marine Services
are hereby ordered to jointly and severally pay petitioner Carlos N. Nisda the amount of US$65,748.00 representing his disability pay
amounting to US$60,000.00 and sickness allowance of US$5,748.00. The 10% attorney's fee is that was awarded by the Labor Arbiter
shall be maintained but must reflect the modified amount of the monetary award and is to be deducted from the same.
#13.

MAGSAYSAY MARITIME SERVICES and PRINCESS CRUISE LINES, LTD., vs. EARLWIN
MEINRAD ANTERO F. LAUREL

G. R. No. 195518

March 20, 2013

FACTS:

Earlwin Meinrad Antero F. Laurel (Laurel) was employed by Princess Cruise Lines, Ltd., through
its local manning agency, petitioner Magsaysay Maritime Corporation, as second pastryman on
board the "M/V Star Princess." In the course of the voyage, Laurel fell ill and was later on
repatriated for further evaluation. Seeking medical care upon return, he was diagnosed with upper
respiratory tract infection and hyperthyroidism. Laurel, then, filed a complaint against the
petitioners before the NLRC, claiming medical reimbursement, sickness allowance, permanent
disability benefits, damages, and attorney’s fees.

The Labor Arbiter's Decision

14
The Labor Arbiter (LA), in a Decision, dated February 1, 2007, dismissed the complaint. The
LA held that Laurel was not entitled to his claims, with his hyperthyroidism having been found as
not work-related by petitioner's company physician.

The NLRC Ruling

On appeal, the NLRC reversed the LA decision and awarded disability compensation in favor of
Laurel. It found that the illness was work-related for failure of the petitioners to overcome the
presumption provided under the POEA-SEC that an illness occurring during the employment,
even if not listed, was work-related.

The CA Decision

The CA, dismissed the petition and sustained the award of disability benefits in favor of Laurel.
It held that the NLRC did not commit a grave abuse of discretion in ordering the payment of
disability benefits to Laurel.The CA explained that although the petitioners' medical literature
spoke of hyperthyroidism as hereditary, it also alluded to the triggers of the disease and cited that
stress could also be a trigger. The CA concluded that stressful conditions could result in, or could
be a factor in, the emergence of hyperthyroidism. It found that the working conditions on board
the MV Star Princess had contributed and aggravated the illness of Laurel. This, according to the
CA, was sufficient to entitle him to disability benefits.

Hence, this petition.

Petitioner’s Contention

MMS argued that Laurel’s illness was not work-related as convincingly proven through the expert
opinion of the company-designated physician. They aver that hyperthyroidism is not among those
listed in the POEA-SEC as an occupational disease, hence, not compensable. They emphasize
that Laurel’s illness was essentially genetic and was not caused by his employment.

Respondent’s Answer

Laurel counters that his illness is compensable because it was acquired during the effectivity of
his employment contract while performing his work aboard the petitioners’ vessel. The fact that
Grave’s Disease may be hereditary does not bar him from entitlement to disability benefits.
Compensability does not require that employment be the sole cause of the illness. It is enough
that there exists a reasonable work connection. The strenuous condition of his employment on
board the MV Star Princess triggered the development of his hyperthyroidism due to his exposure
to varying temperature and chemical irritants.

ISSUE:

Whether or not the respondent is entitled to any disability compensation as his illness is not work-
related.

RULING: YES!

Although Graves’ Disease is attributed to genetic influence, SC finds a reasonable work

connection between Laurel’s condition at work as pastryman (cook) and the development of his
hyperthyroidism. His constant exposure to hazards such as chemicals and the varying
temperature, like the heat in the kitchen of the vessel and the coldness outside, coupled by
stressful tasks in his employment caused, or at least aggravated, his illness. It is already
recognized that any kind of work or labor produces stress and strain normally resulting in wear
and tear of the human body. Thus, the Court sustains the finding of the CA that:

Stressful conditions in the environment, in a word, can result in hyperthyroidism, and the
employment conditions of a seafarer on board an ocean-going vessel are likely stress
factors in the development of hyperthyroidism irrespective of its origin. As recounted by
the respondent in his position paper, the work on board the MV Star Princess was a
strenuous one. It involved day-to-day activities that brought him under pressure and strain
and exposed him to chemical and other irritants, and his being away from home and family
only aggravated these stresses.

Indeed, Laurel has shown a reasonable causation between his working condition and his
hyperthyroidism contracted during his employment warranting the recovery of compensation.
Settled is the rule that for illness to be compensable, it is not necessary that the nature of the
employment be the sole and only reason for the illness suffered by the seafarer. It is sufficient
that there is a reasonable linkage between the disease suffered by the employee and his work to
lead a rational mind to conclude that his work may have contributed to the establishment or, at
the very least, aggravation of any pre-existing condition he might have had.

FALLO:

In fine, the Court holds that the CA correctly found that the NLRC committed no grave
abuse of discretion in ordering payment of disability benefits to Laurel. WHEREFORE, the
petition is DENIED.
#14.

PHILMAN MARINE AGENCY INC. VS. ARMANDO S. CABANBAN

G.R. NO. 186509.

JULY 29, 2013

Facts:

Respondent entered into a 9-month contract of employment with the petitioner. The former was
subjected to pre-employment medical examination and was declared fit to sea service. On
October 14, 2002, he was deployed for work. On February 9, 2003, while on board, he
experienced chest pain and was brought to hospital. He was repatriated to the Philippines on
February 10, 2003 and arrived thereat on February 23, 2003. Upon close monitoring, the
physician declared respondent “fit to work” on May 12, 2003.

Despite the physician’s declaration of “fit to work”, respondent did not heed such and instead file
a complaint against petitioner for disability compensation benefit. Respondent argued that his
ailment is a ground for claiming disability benefits. He also seeks for payment of sickness
allowance and other monetary claims.

Labor Arbiter

LA dismissed Armando’s claims except for the balance of the latter’s sickness allowance in the
amount of P68,560.30. In ruling for the petitioners, the LA declared that the petitioners had fully
complied with their liabilities to Armando for the work-related injury/illness suffered by the latter
during the term of the contract, pursuant to the POEA-SEC. The LA noted that the petitioners’
company-designated physician declared Armando fit to work after three months of monitoring and
treatment, in contrast with Armando’s chosen physicians who arrived at their diagnosis after only
one day of consultation. The findings and declaration of Dr. Alegre, which Armando did not
question, therefore binds the latter and bars his claim for disability benefits. Armando appealed
28
the decision with the NLRC.

The Ruling of the NLRC

NLRC dismissed Armando’s appeal for lack of merit. As the LA did, the NLRC upheld the
certification of fitness to work issued by Dr. Alegre over the various medical certificates Armando
presented. The NLRC noted that the diagnosis of the several private doctors consulted by
Armando was based merely on a review of Armando’s medical history and not the result of a
thorough examination, treatment and monitoring similar to that undertaken by Dr. Alegre. The
NLRC concluded that absent proof that the certification of fitness to work was irregularly issued
or did not reflect his actual condition, Armando’s claim for disability benefits under the POEA-SEC
is without merit.

The Ruling of the CA

CA reversed the NLRC’s decision

Hence, this petition.

Petitioner’s Allegations

Petitioner denied any liability for disability benefits arguing that their company-designated
physician has already declared respondent “fit to work” following the normal results of his
laboratory tests. Petitioner also disagreed with respondent’s computation of his sickness
allowance at 120 days. Petitioners argued that the physician declared him fit to work on May 12,
2003, 92 days counting from February 10, 2003, the day he disembark from the vessel.

Respondent’s Reply

36
Relying on the ruling of the CA, Armando contends that a seafarer’s entitlement to disability
benefits automatically accrues by reason of death or illness. He argues that in claims for disability
benefits under the POEA-SEC, the presumption of compensability and aggravation of the illness
exists as long as the illness occurred during the term of the contract. The employer has the burden
to rebut these presumptions which, in this case, the petitioners failed to do.

Issue:

W/N the respondent can claim total and permanent disability benefits?

Ruling:

The Supreme Court ruled that respondent is not entitled to total and permanent disability benefits.
The Labor Code provides that disability to be deemed total and permanent should last
continuously for more than 120 days. In this case, respondent was declared fit to work within 120
days period- 92 days after disembarking from the vessel. In the same manner, the compensation
and benefits for injury or illness when the seafarer suffers the same during the term of his contract
is entitled to allowance equivalent to his basic wage until he is declared fit to work or the degree
of permanent disability has been assessed by the company-designated physician but in no case
shall this period exceed 120 days. Thus, such benefits for injury or illness shall only be computed
for 92 days.
As a final note, while the Court adheres to the principle of liberality in favor of the seafarer in
66
construing the POEA-SEC, it cannot allow claims for compensation based on surmises.
Liberal construction is not a license to disregard the evidence on record or to misapply our laws.

FALLO:

WHEREFORE, premises considered, we hereby GRANT the petition and accordingly REVERSE
and SET ASIDE the decision dated December 10, 2008 and the resolution dated February 18,
2009 of the Court of Appeals in CA-G.R. SP No. 105079, and REINSTATE the decision dated
February 29, 2008 of the NLRC affirming the December 29, 2004 decision of Labor Arbiter Fedriel
S. Panganiban.

15.Sea Power Shipping Inc., and/or Bulk Carriers Limited and Special Maritime
Enterprises, and M/V Magellan vs Nenita P. Salazar, on behalf of deceased
Armando L. Salazar

GR. No. 188595

August 28, 2013

FACTS:

Armando Salazar was employed as an Able Seaman by petitioner Sea Power Shipping
Enterprises Inc. on behalf of its principal, Atlantic Bulk Carriers Limited. At the time of his
employment he had already passed his pre-employment medical examination and had
been declared fit to work.

Armando boarded the M/V Magellan and after the end of his contract he returned to our
shores. However, two days after, he was taken to a hospital where he was confined in
the ICU for three days. According to medical reports, he suffered from pneumonia, and
because of such confinement he was unable to see the agency's physician for a post-
employment medical examination (PEME) that was supposed to be conducted within
th th
72hours from his repatriation. Nevertheless on the 7 or 8 day of Armando's
confinement, Salazar informed petitioners of her husband's condition and even asked
them for the proceeds of the insurance.
The agency denied Salazar's claims. It reasoned that without the requisite PEME his
beneficiaries could not avail themselves of the sickness allowance. Later on Armando's
condition worsened and he checked in and out of hospitals, he was diagnosed of having
lung cancer and after six months he died.

Salazar instituted a collection suit against petitioners for medical expenses, burial
expenses, compensation and death benefits, and minor child's allowance for their
daughter.

ISSUE: Whether or not Salazar is entitled to illness benefits and death benefits?

RULING:

The Court granted the claim for illness benefits. Admittedly, Armando did not report for
PEME, however for a person who's terminally ill, it is understandable, as he is physically
incapacitated to do it. The Court explained that while it may be true that there was no
record to prove that Armando was ill while on board the vessel as there was no report of
any illness on his part, nor did he ask for medical attention during the term of his contract,
medical history and human experience would show that lung cancer does not just develop
in one day or much less, develop that fast, hence it was inferred that his lung cancer was
contracted during his service.

However the Court did not grant the death benefits to Salazar as there was absent any
semblance of causation, it cannot be inferred that the death of Armando after the term of
his contract is compensable, if the inference is based solely on circumstance that he was
confined within two days and died within six months after his repatriation. There was no
substantial evidence to support the claim for compensation and death benefits. As ruled
by the Court in Gabunas, Sr. v. Scanmar Maritime Services Inc., citing Government
Service Insurance System v. Cuntapay, claimants in compensation proceedings must
show credible information that there is probably a relation between the illness and the
work. Probability, and not mere possibility, is required; otherwise the resulting conclusion
would proceed from deficient proofs.
19. Status Maritime Corporation vs. Sps. Delalamon

Facts:

Respondent Margarito Delalamon was hired as Engineer by Status Maritime

Corporation for a period of 9 months from July 26, 2005 to April 26, 2006. However,
Respondent requested for a contract extension and it was extended until October October
2006.

Sometime in September, 2006, he complained for loss of appetite. He was then

sent to a hospital in UAE for medical attention and he was diagnosed with Renal
Insufficiency, Diabetes Mellitus and Anemia. He repatriated on September 6, 2006.

Upon returning to the Philippines, respondent was still weak. He sought to rest at
home and failed to notify his employer, herein Petitioner, about his condition. But later,
his wife notify petitioner of his condition through one Allan Lopez. The condition of
respondent worsened. He was brought to Las Pinas Doctor’s Hospital. He also underwent
surgeries. Eventually, he became bedridden.
 On September 2006, respondents filed a complaint before the Labor Arbiter for the
payment of Permanent Disability Benefits. Pending his appeal on Labor Arbiter, he died
and CVA or Cardiovascular Accident was the cause of his death.

Respondents’ Contention:

Respondents alleged that petitioner failed to provide any medical assistance the
entire time Respondent Margarito was undergoing medical treatments for an illness he
acquired during his employment with the petitioner.

Petitioner’s Contention:

Petitioner denied liability, because respondent failed to notify them and report his
arrival for a Post-Employment Medical Examination. Also, the disability is not
compensable on the ground that diabetes is not work-related and according to evaluation,
he was diagnosed of diabetes 6 years prior to his employment with the petitioner.

Labor Arbiter’s Decision:

Denied the respondents’ complaint on the ground that the illness is not work
related.

NLRC:

Affirmed the decision of LA and added that respondent failed to comply with the 3-
day mandatory reporting requirement.

CA:

Reversed the decision of LA and NLRC. Respondent was exempted from

complying the mandatory reporting requirement because his health was already
deteriorating. Also, the illness was listed as an occupational disease under the POEA-
SEC. His employment contributed to the development of the illness.

Issue:

Whether or not the illness is compensable?

Ruling:

NO.

On the Mandatory Reporting Requirement:

Respondent was exempted to report personally to the employer, because of his

deteriorating health.

Respondent complied with requirement, because petitioner was already aware of

the condition of the respondents because they are aware that respondent Margarito was
diagnosed with diabetes in UAE because they presumed furnished with a copy of the
diagnosis made on Margarito.

Respondent was disqualified for concealing his re-existing illness

Eventhough respondent was declared fit to work in his Pre-employement Medical

Examination, such cannot be use as a defense because PEME is not exploratory. It was
established that Margarito acquired his illness prior to his employment with Petitioner.
While it is true that pre-existing illness is not a bar a to claim disability benefits, but the
employee must present a substantial evidence that the nature of his work contributed or
aggravated his illness. This burden of proof was not discharged by the respondents.

[The Supreme Court also added that the very nature of diabetes does not indicate
workrelatedness. Diabetes by nature is more of the result of poor lifestyle choices and
health habits for which disability benefits are improper.]

20. Canuel vs. Magsaysay Maritime Corporation

Facts:

Nancing Canuel was hired by respondent as an Engineer. His employment was

for a period of 12 months. He underwent pre-employment medical examination and was
declared fit for work. He started his employment on July 19, 2006.

Nancing had an accident while performing his official duties and injured the right
side of his body. He was brought to Shanghai Seamen Hospital in China and was
diagnosed that he was suffering from bilateral closed traumatic hemothorax. On March
24, 2007, he repatriated and was immediately admitted to Manila Doctor’s Hospital. Due
to his worsening condition, he as placed under ICU and eventually, he died. The death
Certificate stated that his death was due to acute respiratory failure.

The wife, together with her minor children, filed a complaint before the NLRC a
complaint seeking to recover death benefits.

Petitioner’s Contention:

Death Benefits during repatriation is compensable because it was the accident he

suffered on board which triggered his traumatic hemothorax which is the cause of his
death.
Respondent’s Contention:

Respondents denied liability arguing that acute respiratory failure is not work-
related as advised by their company doctor. Also, lung cancer is not a work-related illness.
The death of the respondent did not occur during his employment term because his
employment is deemed terminated the moment he repatriated.

Labor Arbiter’s Decision:

LA granted the disability death benefits to the petitioner. LA found that his death
occurred during his employment term and that his illness was caused by an accident while
he was performing his official functions and that the nature of his work triggered his illness.

NLRC:

Sustained the decision of the LA.

CA:

It held that death of the seafarer after the termination of his contract is not
compensable, even if the death is caused by the same illness which prompted his
repatriation of the seafarer and the termination of his contract. (Klaveness vs Alias)

MR- denied

Issue:

Whether or not the Petitioners are entitled for death benefits?

Ruling:

YES.

The terms and conditions of a seafarer’s employment are governed by the

provisions of the contract he signs with the employer at the time of his hiring. Under the
provisions of POEA-SEC, the seafarer’s beneficiaries may claim benefits if they are able
to establish that the seafarer’s death is work-related and had occurred during the term of
his employment contract.

ON WORK-RELATEDNESS OF THE DEATH

The death of the husband of petitioner resulted from work related injury. Nancing
suffered a work-related injury which he acquired in an accident he met while performing
his official functions. This circumstance fil the legal attribution of the phrase “arising out
of and in the course of employment.”

The two components of the coverage formula – "arising out of" and "in the course of
employment" – are said to be separate tests which must be independently satisfied;
however, it should not be forgotten that the basic concept of compensation coverage is
unitary, not dual, and is best expressed in the word, "work-connection," because an
uncompromising insistence on an independent application of each of the two portions of
the test can, in certain cases, exclude clearly work-connected injuries. The words "arising
out of" refer to the origin or cause of the accident, and are descriptive of its character,
while the words "in the course of" refer to the time, place, and circumstances under which
the accident takes place.

Compensability does not depend on whether the injury or disease was pre-existing at the
time of the employment but rather if the disease or injury is work-related or aggravated
his condition.

THE DEATH OCCURRED DURING THE TERM OF EMPLOYMENT

While it is true that the seafarer’s death should occur during the term of his
employment, the seafarer’s death occurring after the termination of his employment due
to his medical repatriation on account of a work-related injury or illness constitutes an
exception thereto. This is based on a liberal construction of the 2000 POEA-SEC as
impelled by the plight of the bereaved heirs who stand to be deprived of a just and
reasonable compensation for the seafarer’s death, notwithstanding its evident work-
connection. The present petition is a case in point.

Appplying the liberal construction, the Court brought to the recognition that medical
repatriation cases should be considered as an exemption.

22. JEBSEN MARITIME, INC., APEX MARITIME SHIP MANAGEMENT CO. LLC.,
AND/OR ESTANISLAO SANTIAGO, petitioners, vs. WILFREDO E. RAVENA,
respondent; G.R. No. 200566; September 17, 2014; BRION, J.

FACTS:

On September 6, 2006, Ravena entered into a ten-month contract of employment with

petitioner Jebsen Maritime, Inc. and its principal, Apex Maritime Ship Management Co.,
LLC. (collectively, the petitioners). He was employed as 4th Engineer on board the vessel
"M/V Tate J" with a basic monthly salary of US $859.00, exclusive of other benefits.
Ravena’s contract was also subject to a CBA. Prior to the September 6, 2006 contract,
Ravena previously worked for the petitioners from March 1, 2004 to August 11, 2006 9 in
the same position. On September 28, 2006, as per pre-employment medical examination,
he was declared “fit to work”. he boarded M/V Tate J on September 28, 2006.

On May 2007, and while on board M/V Tate J, Ravena suffered extreme abdominal pain,
with chills, diarrhea, general feeling of weakness and muscle spasms. On May 12, 2007,
he was repatriated to the Philippines, after which he went directly to his hometown in
Iloilo. On May 15, 2007, Ravena went to a hospital in Iloilo, a mass was found in his
ampullary area.

On May 17, 2007, he informed the petitioners that he had to undergo Whipple surgery.
Ravena and the petitioners agreed that the former shall shoulder the medical expenses
for the surgery, subject to reimbursement by the latter. Ravena underwent the surgery on
May 21, 2007. He was subsequently diagnosed of adenocarcinoma or cancer of the
ampullary area.

On June 18, 2007, more than a month after his repatriation, Ravena reported at Jebsen's
office in Manila. He was referred to Dr. Nicomedes Cruz, a cancer surgeon and the
company-designated physician. Dr. Cruz opined that Ravena's illness was not work-
related. The petitioners denied Ravena's claim for disability benefits. On July 23, 2007,
Ravena filed his complaint for disability benefits with the LA.

Decision of the Labor Arbiter

On May 26, 2008, the LA granted in part Ravena's complaint, and ordered the
petitioners to pay Ravena the amount of US$125,000.00, as disability benefits. The claim
for medical reimbursement and sickness benefits was denied as the petitioners had
settled them in full. The LA ruled that Ravena did not need to establish causal connection
between his work and his illness. The LA held that the combination of physical, mental
and emotional pressure and strain to which Ravena was exposed, had increased
Ravena’s risk of contracting the illness, and further held that the illness was caused and
aggravated by the conditions present in his job. The LA gave weight to the medical
certificate that Ravena presented, over that of Dr. Cruz which she regarded as self-
serving and biased.

Decision of the NLRC

On June 30, 2009, the NLRC reversed the LA's ruling and dismissed Ravena's complaint.
NLRC, Ravena failed to prove, by substantial evidence, that his illness was work-related,
particularly in the light of the certification issued by Dr. Cruz that his illness —
adenocarcinoma of the ampullary area — was not work-related.
To the NLRC, aside from his bare allegations that "exposure to various substances over
the years caused his disease," Ravena did not present any evidence to prove that indeed
his illness was either work-related or work-aggravated. That he contracted the illness
during his employment contract does not automatically translate to its work-relatedness.
The NLRC denied Ravena's motion for reconsideration in its resolution dated January 18,
2010. Ravena elevated the case to the CA via a petition for certiorari.

Decision of the CA

On November 11, 2011 the CA granted Ravena's petition and reinstated LA’s decision
but reduced the disability benefit award from US$125,000.00 to US$60,000.00.

The CA agreed with the LA that to be entitled to disability benefits under the 2000 POEA-
SEC, the seafarer only needs to show that his work and/or his working conditions
contributed, even in a small degree, to the development or aggravation of his disease. In
Ravena's case, he reasonably proved that his working conditions exposed him to factors
that aggravated his medical condition. The CA pointed out that while the possible causes
of his cancer are poorly understood, experts have advised that to prevent its growth,
avoiding fatty foods and maintaining a well-balanced diet rich in fruits and vegetables
help.

Relying on the Court's ruling in Leonis Navigation Co., Inc. v. Villamater, the CA noted
that in his Answer (to the petitioners' Memorandum on Appeal) and the Motion for
Reconsideration before the NLRC, Ravena argued, among others, that the food on board
M/V Tate J, consisted mainly of frozen red meat and processed food, all of which
contributed to the risk of contracting or aggravating his illness. The petitioners never
controverted this allegation. Although Ravena raised this argument only in the petitioners'
appeal before the NLRC, it should have been and may still be properly admitted in the
interest of substantial justice. Thus to the CA, while his adenocarcinoma of the ampullary
area is a non-occupational disease per the POEA-SEC, Ravena is nevertheless entitled
to full disability benefits. Thus, the CA reduced the amount of the disability benefits that
the LA awarded to US$60,000.00, following the schedule under the 2000 POEA-SEC.

Petitioner’s Contentions:

First, petitioners maintain that Ravena failed to discharge the burden of proving, by
substantial evidence, the causal connection between the nature of his work and his illness
or that the risk of contracting adenocarcinoma was increased by his working conditions.
In addition, Ravena did not present any evidence that the food on board M/V Tate J were
high in fat and low in fiber, or that they caused or aggravated his ampullary cancer.
Second, the cancer of the ampullary area that afflicts Ravena is not one of the illnesses
Section 32 of the POEA-SEC considers as occupational disease.Third, while actual or
direct proof of causal connection between the working conditions and the seafarer's
illness is not required, the award of disability benefits must still have sufficient basis.
Fourth, Ravena did not report to them or to their designated physician within the three-
day POEA-SEC mandated period for the post-employment medical examination. Fifth,
Court rulings had already settled that the opinion of the company-designated physician
will prevail in the determination of the seafarer's disability in disability benefits claims.
Ravena, notably, did not even present a contrary opinion from his chosen physician.

Ravena’s Contentions:

Ravena counters that he has successfully proven the existence of the causal connection
between his illness and the working conditions on board M/V Tate J, or that his working
conditions had, at the least, aggravated his illness.

He argues that the exposure to chemicals, the demands of ship duties, and dietary
provisions directly caused or aggravated his illness. This conclusion Ravena contends, is
in line with jurisprudences that considered cancer as compensable illness. HE cited
Employees Compensation Commission v. Court of Appeals and Heirs of Abraham Cate
and argues that a disability benefits claimant is not even obliged to prove causal
connection between the illness and his working conditions. Additionally, in Section 20-B
of the POEA-SEC, illnesses not otherwise listed as an occupational disease under
Section 32-A are nevertheless disputably presumed to be work-related. The burden,
therefore, lies on the petitioners to rebut this disputable presumption of work-relatedness,
Ravena argues that the petitioners failed to discharge this burden.

In addition, Ravena points out that the POEA-SEC does not require that the company-
physician first declare that the seafarer's illness is work-related for illness to be
compensable and in addition, the courts are not even bound by the declaration from the
company-designated physician.

ISSUE:

Whether or not Ravena’s illness is work related and thus compensable.

RULING OF THE SUPREME COURT:

Ravena’s illness is not work related and thus not compensable. Ravena is not entitled to
disability benefits since he failed to comply with the prescribed procedures and to prove
the required connection or aggravation between his illness and work conditions.

Law provides that diseases existing during the course of employment are presumed to
be work related, however this presumption is disputable. This disputable presumption is
made in the law to signify that the non-inclusion in the list of compensable
diseases/illnesses does not translate to an absolute exclusion from disability benefits. In
other words, the disputable presumption does not signify an automatic grant of
compensation and/or benefits claim; the seafarer must still prove his entitlement to
disability benefits by substantial evidence of his illness' work-relatedness. In Cootauco v.
MMS Phil. Maritime Services, Inc., we categorically declared that whoever claims
entitlement to the benefits provided by law should establish his rights to the benefits by
substantial evidence

In situations where the seafarer seeks to claim the compensation and benefits that
Section 20-B grants to him, the law requires the seafarer to prove that: (1) he suffered an
illness; (2) he suffered this illness during the term of his employment contract; (3) he
complied with the procedures prescribed under Section 20-B; (4) his illness is one of the
enumerated occupational disease or that his illness or injury is otherwise work-related;
and (5) he complied with the four conditions enumerated under Section 32-A for an
occupational disease or a disputably-presumed work-related disease to be compensable.

Under these considerations, Ravena's claim must obviously fail; he failed to substantially
satisfy the prescribed requirements to be entitled to disability benefits.

First, Ravena failed to comply with the procedural requirements of Section 20-B of the
POEA-SEC.

Under Section 20-B (3), paragraph 2, a seafarer who was repatriated for medical reasons
must, within three working days from his disembarkation, submit himself to a post-
employment medical examination (PEME) to be conducted by the company-designated
physician. Failure of the seafarer to comply with this three-day mandatory reporting
requirement shall result in the forfeiture of his right to claim the POEA-SEC granted
benefits

The reporting requirement, of course, is not absolute as we have allowed, in certain

exceptional circumstances, a seafarer's claim despite his non-reporting within the
mandated three-day period, i.e., when the seafarer is physically incapacitated to comply
with the reporting requirement, provided, he gives, within the same three-day period, a
written notice of his incapacity to the manning agency. Note that this duty to report to the
company-designated physician for the required medical examination lies with him

In addition, there is absolutely no evidence on the record showing a determination of total

or partial permanent disability with the corresponding determination of the appropriate
disability grading that could have formed the basis for his disability claims.

Under Section 20-B (3), the company-designated physician initially determines either the
fitness-to-work or the degree of the permanent disability (total or partial) of the seafarer
who suffered and was repatriated for work-related illness or injury. The seafarer, of
course, is not irretrievably bound by such determination. Should he disagree with the
determination of the company-designated physician, the POEA-SEC allows him to seek
a second opinion from an independent physician of his choice. If the assessment of his
chosen physician conflicts with those of the company-designated physician, the seafarer
and the employer may agree on a third doctor whose determination shall be final and
binding on them.

In this case, neither Dr. Cruz nor Ravena's chosen physician made any determination of
Ravena's disability. In fact, we note that Ravena's physician did not even certify that he
was no longer fit-to-work, or at the very least determine the appropriate disability grading;
he simply stated that "he must not be away from a treatment area for an indefinite period
of time." On the other hand, Dr. Cruz certified that Ravena's illness is not at all work-
related.

Second, Ampullary cancer is not an occupational disease.

The LA and the CA may have correctly afforded Ravena the benefit of the legal
presumption of work-relatedness. The legal correctness of the CA's appreciation of
Ravena's claim, however, ends here for as we pointed out above, Section 20-B (4) affords
only a disputable presumption that should be read together with the conditions specified
by Section 32-A of the POEA-SEC. Under Section 32-A, for the disputably-presumed
disease resulting in disability to be compensable, all of the following conditions must be
satisfied:

1. The seafarer's work must involve the risks describe therein;

2. The disease was contracted as a result of the seafarer's exposure to the

described risks;

3. The disease was contracted within a period of exposure and under such
factors necessary to contract it; and

4. There was no notorious negligence on the part of the seafarer.

Ravena failed to prove the work-relatedness of his ampullary cancer as he failed to satisfy
these conditions.

For one, he did not enumerate his specific duties as a 4th engineer or the specific tasks
which he performed on a daily basis on board M/V Tate J. Also, he did not show how his
duties or the tasks that he performed caused, contributed to the development of, or
aggravated his ampullary cancer. He likewise did not specify the substances or chemicals
which he claimed he was exposed to. Further, he failed to prove that he had indeed been
exposed to the chemicals/substances he claimed he was exposed to during his
employment contract and how these substances/chemicals could have caused his
ampullary cancer; or measures that the company did or did not take to control the hazards
occasioned by the use of such substances/chemicals, to prevent or to lessen his
exposure to them.

We cannot also consider as substantial evidence of his disease's work-relatedness the

ILO article that Ravena submitted before the LA on the duties and occupational hazards
that a ship engineer encounters. As presented, this ILO article is simply a general list of
the possible hazards that may typically attach to the duties of a ship engineer.Hence, this
ILO article could not serve as sufficient proof that his working conditions caused,
contributed to the development of, or aggravated Ravena's ampullary cancer. No
reasonable conclusion of work-relatedness can also be inferred in this case given the
nature of ampullary cancer vis-à-vis the duties of and the occupational hazards that a
ship engineer encounters per the ILO article.

We point out again that the medically determined risk factors for the development of
ampullary cancer are genetic factors and alterations, smoking and certain diseases.

Stated differently, we declare that Ravena's ampullary cancer is not work-related, and
therefore not compensable, because he failed to prove, by substantial evidence, its work-
relatedness and his compliance with the parameters that the law had precisely set out in
disability benefits claim. For, while we adhere to the principle of liberality in favor of the
seafarer in construing the POEA-SEC, we cannot allow claims for disability compensation
based on surmises. Liberal construction is never a license to disregard the evidence on
record and to misapply the law.

23. TEEKAY SHIPPING PHILIPPINES, INC., TEEKAY SHIPPING LIMITED AND

ALEX VERCHEZ, Petitioners, v. EXEQUIEL O. JARIN, Respondent; G.R. No.
195598; June 25, 2014; REYES, J.

FACTS

After passing the standard Pre-Employment Medical Examination, the petitioners hired
Jarin as Chief Cook on July 6, 2006 for a period of eight months with a basic monthly
salary of US$722.40. Jarin was deployed on July 9, 2006 on board M.T. Erik Spirit, a
crude oil tanker.

During the third week of February 2007, M.T. Erik Spirit was in Canada when Jarin
complained of swelling in the joints of his two elbows. Jarin was taken to a Canadian
hospital where he was diagnosed with rheumatoid arthritis. Steroid-based medications
were administered to him and they caused him the side effects of puffiness of the face
and edema. Despite of this, however, Jarin was able to complete his employment
contract. He was repatriated on March 24, 2007.

Upon arrival in the Philippines, Jarin immediately reported to the petitioners. On March
27, 2007, he was referred to company-designated physician, Dr. Christine O. Bocek
whose Post-Medical Report showed that Jarin has “moon facies and bipedal edema
secondary to steroid intake, [r]heumatoid arthritis, resolving and upper respiratory tract
infection.”

On April 12, 2007, Jarin was referred to another company-designated physician at the
Metropolitan Medical Center (MMC) for further assessment under the care of Dr. Wilanie
Romero-Dacanay (Dr. Dacanay). Dr. Dacanay opined in a medical report dated June 22,
2007, that Jarin’s rheumatoid arthritis was not work-related and also that Jarin’s
cushingnoid features was also declared as not work-related. In the same report, Dr.
Dacanay noted that chronic obstructive pulmonary disease is almost always the result of
cigarette smoking to which Jarin admitted to have been engaged in since he was in high
school.

On July 24, 2007, Dr. Dacanay’s evaluation cleared Jarin of his pulmonary ailment
although he still complained of joint pains. Jarin was advised to continue his medications
and to undergo remicade infusion. He was due for re-evaluation on July 31, 2007, in which
date he was recommended for admission for his remicade infusion. In the follow-up report
dated August 2, 2007, Jarin was admitted in the MMC. The following day, Jarin was
discharged from the hospital and was prescribed medications.

On August 16, 2007, Jarin underwent laboratory tests and was advised to come back on
September 17, 2007. The following day, Dr. Mylene Cruz-Balbon (Dr. Balbon) issued a
private and confidential evaluation stating that rheumatoid arthritis is a chronic illness
“which can become progressive that has the potential to cause joint destruction and
functional disability.” Jarin was “no longer recommended for further sea duties.”

Without any knowledge of Dr. Balbon’s recommendation, Jarin received a call on

September 10, 2007 from Teekay Phils. directing him to report at Pandiman Phils., Inc.
(Pandiman) at Intramuros, Manila. On the following day, Jarin went to Pandiman where
he was informed that his illness is not work-related and that Teekay Phils. stopped paying
for his medical treatments. Jarin asked for a medical report supporting such conclusion
but he was not furnished any.

On September 13, 2007, he was directed to process his Clearance which read:

“UNFIT – PEME”

“MEDICAL TREATMENT (TERMINATED) – NO LONGER RECOMMENDED FOR

FURTHER SEA DUTIES – NON WORK REL.”

Subsequently, Jarin became a partial disability pensioner of the Social Security System
and no longer worked as seaman in view of his illness. On April 18, 2008, Jarin filed a
complaint before the Arbitration Branch of the National Labor Relations Commission
(NLRC) claiming US$60,000.00 as permanent total disability benefit, US$2,889.60 as
sickness allowance for his incapacity to work for 120 days pursuant to the Philippine
Overseas Employment Agency-Standard Employment Contract for Filipino Seafarers
(POEA-SEC), US$10,000.00 as moral damages and exemplary damages and ten
percent (10%) of the total monetary award as attorney’s fees.

The petitioners refused to pay and maintained that Jarin’s illnesses are not work-related;
that his chronic obstructive pulmonary disease was assessed by their physicians to have
resulted from his years of heavy smoking; that their liability as employer would arise only
“when the seafarer suffers [a] work-related injury or illness during the term of his contract,”
as indicated in Section 20(B) of the POEA-SEC.21cralawred

Decision of the Labor Arbiter

On September 23, 2008, the Labor Arbiter (LA) ruled that the seafarer’s clearance issued
to Jarin stating that he is “unfit and no longer recommended for further sea duties”
signifies his incapacity to work as a seaman.

The petitioners’ evidence was found inadequate to dispute the presumption that illnesses
not listed in Section 32 of the POEA-SEC are work-related. Thus, Jarin’s money claims
were granted and he was awarded US$50,000.00 for suffering an illness categorized as
Grade 1 Impediment based on the Schedule of Disability Allowances of the POEA-SEC.
He was also awarded US$2,889.60 for failure of the petitioners to show payment of his
120-day sickness allowance. Both parties appealed from the foregoing ruling. Jarin
argued that his permanent total disability benefits should be US$60,000.00 or 120% of
US$50,000.00, pursuant to the Schedule of Disability Allowances of the POEA-SEC.

The petitioners, on the other hand, challenged the LA’s reliance on the clearance issued
to Jarin as it did not state that his illnesses are work-related or that he was suffering from
a compensable disability.

Decision of the NLRC

In a Decision dated October 23, 2009, the NLRC Seventh Division ruled in favor of the
petitioners. The NLRC considered Jarin’s rheumatoid arthritis as the cause of his disability
while his chronic obstructive pulmonary disease was disregarded for it has nothing to do
with his muscular discomforts.

The NLRC stated that while rheumatoid arthritis is disputably presumed work-related
pursuant to Section 20(B)(4) of the POEA-SEC, the petitioners, however, were able to
successfully overturn such presumption through the consistent medical reports of its
designated physicians that such illness is not work-related. Their medical opinions bear
greater evidentiary weight that the internet information presented by Jarin to prove that
his illness has reasonable connection to his work. The NLRC also noted Jarin’s failure to
seek medical opinion from a physician of his choice to counter the company-designated
physicians’ assessment. Jarin moved for reconsideration but his motion was denied in the
NLRC Resolution.

Decision of the CA

In a Decision dated November 26, 2010, the CA reversed the NLRC and reinstated the
LA’s ruling. The CA found the petitioners liable for permanent and total disability benefits
because Jarin was able to adduce substantial evidence that the risk of contracting
rheumatoid arthritis was increased by his exposure to the working conditions in the
vessel. The CA admitted Jarin’s sworn narration that he was often required to work for
long periods of time, constantly exposed to extreme temperatures while performing his
functions and was made to carry heavy loads which caused so much stress to his joints
and muscles. The CA held that such factors prove the causal connection between Jarin’s
work and the increased risk of developing rheumatoid arthritis. The CA faulted the NLRC
for failing to consider such sworn narration considering that what the law requires is not
direct proof but reasonable proof of the causal connection between the work and ailment.

ISSUE

Whether or not Jarin’s illness is considered as permanent disability for the purpose of
compensation.

RULING OF THE SUPREME COURT

Jarin’s illness is considered as permanent disability for the purpose of compensation. In

the case at bar, Jarin was able to prove that his rheumatoid arthritis was contracted out
of his daily duties as Chief Cook onboard M.T. Erik Spirit. The narration of facts in his
position paper detailed the nature of his work as Chief Cook and the daily working
conditions on sea duty.

Further, a careful study of the medical opinions issued by the petitioners’ doctors strikes
this Court to declare that as early as February 2007, Jarin’s rheumatoid arthritis was
already detected by a doctor in Canada. This was fully verified by the medical opinions
issued by the petitioners’ company-designated physicians in Manila which all indicated
that Jarin has rheumatoid arthritis. This is why an intensive medical treatment was
administered to him under their care. To recall, even the medical report dated August 16,
2007 advised Jarin to continue his medication and to come back to them on September
17, 2007 considering that his body did not respond well to the enbrel injections already
given him. On August 17, 2007, Dr. Balbon issued an opinion declaring him
unrecommendable for further sea duties coupled with the drastic withdrawal of the
medical treatment given to him by the petitioners. It is unmistakable from such
recommendation that Jarin’s rheumatoid arthritis has rendered him permanently
incapacitated to work as a seaman. Also, by the very same clarity of Dr. Balbon’s
recommendation, it became unnecessary for Jarin to consult the opinion of his own
doctors.

The Court further agrees with the LA, as affirmed by the CA, that the petitioners failed to
present any evidence showing that they paid Jarin’s sickness allowance. The petitioners
cannot escape such liability on the mere fact that Jarin finished his contract and was not
medically repatriated. It must be borne in mind that when Jarin arrived in the Philippines,
he was still suffering from rheumatoid arthritis, moon facies and bipedal edema and upper
respiratory tract infection, as confirmed by the petitioners’ physician.

24. STATUS MARITIME CORPORATION, MS. LOMA B. AGUIMAN, FAIRDEAL GROUP

MANAGEMENT S.A., and MT FAIR JOLLY, Petitioners, vs. SPOUSES MARGARITO B.
DELALAMON and PRISCILA A. DELALAMON, Respondents. G.R. No. 198097; July 30,
2014; REYES, J.

FACTS

Margarito was hired by Status Maritime Corporation (Status Maritime), for and in behalf of its
principal, Fairdeal Group Management S.A. (Fairdeal), as Chief Engineer with a monthly basic
salary of US$1,300.00. The employment contract was originally for a period of nine (9) months
from July 26, 2005 to April 26, 2006 but Margarito later on requested for, and was granted,
extension until October 2006.

Margarito left Manila to join the vessel, M/T Fair Jolly, on July 26, 2005 and forthwith discharged
his duties. In September 2006, while the vessel was in United Arab Emirates (UAE), Margarito
complained of loss of appetite. He was sent to the National Medical Center at the Port of Fujairah,
UAE, for diagnosis and treatment. In a Medical Report dated September 2, 2006. Margarito was
diagnosed with "Renal Insufficiency: Diabetes Mellitus; IHD Blood+CBC+Anemia." He was
medically repatriated on September 6, 2006.

On December 29, 2006, Margarito and his wife Priscila (respondents) filed a complaint before the
Labor Arbiter (LA) for the payment of permanent disability benefits, sickness allowance, damages
and attorney’s fees against Fairdeal, M/T Fair Jolly, Status Maritime and its President, Loma B.
Aguiman (petitioners). According to the respondents, Margarito was physically weak when he
arrived in the Philippines. He thus sought to rest athome and failed to report to the petitioners.
Priscilla nonetheless notified the petitioners of Margarito’s condition through a certain Allan Lopez.

He thereafter underwent dialysis treatments three times a week and eventually became
bedridden. The respondents averred that the petitioners failed to provide any medical assistance
the entire time thatMargarito was undergoing medical treatments for an illness he acquired while
in their employ. For their part, the petitioners denied any liability for Margarito’s monetary claims.
They asserted that he failed to comply with Section 20(B), paragraph (3) of the 2000 Amended
Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board
Ocean-Going Vessels (POEA-SEC) requiring him to report to the petitioners within three (3)
working days from his arrival for a post-employment medical examination. He was only examined
by the petitioners’ designated physician on March 30, 2007 during the mandatory conference
stage of the case.

According to the petitioners, Margarito’s illness is not compensable based on the medical report
dated May 17, 2007 of Dr. Wilanie Romero Dacanay of the Marine Medical Services of
Metropolitan Medical Center stating that "Chronic Kidney Disease secondary to Diabetic
Nephropathy" is NOT work-related. The petitioners further averred that during initial evaluation by
their physicians, Margarito claimed to have been diagnosed with diabetes 6 years ago and has,
since then, been taking 500 mg of Metformin as maintenance medication. Based thereon, the
petitioners argued that Margarito concealed his illness when he was subjected to a Pre-
Employment Medical Examination (PEME) hence disqualified from claiming disability benefits.
Pending the decision of the LA, Margarito died on September 11, 2007. His cause of death was
"CVA" or Cardiovascular Accident.

Decision of the Labor Arbiter

On September 28, 2007, the LA found no merit in the respondents’ complaint for the
reason that Margarito’s illness is not work-related, the case was forthwith dismissed.

Decision of the NLRC

The NLRC affirmed the LA’s ruling and added that Margarito did not even bother to
comply with the mandatory requirement of reporting to the petitioners’ office within three
(3) days from his disembarkation for post-employment medical examination pursuant to
Section 20 (B)[3] of the POEA-SEC.

Decision of the CA

The respondents elevated the case to the CA and, in support of their position that
Margarito’s illness is work-related, proffered the June 25, 2007 medical evaluation of Dr.
Efren R. Vicaldo (Dr. Vicaldo) of Philippine Heart Center, articulating that Margarito is now
unfit to resume work as seaman in any capacity, that his illness is considered work
aggravated/related, and he is not expected to land a gainful employment given his
medical background.

Thereafter, the CA reversed the findings of the labor tribunals. The CA held that Margarito was
exempt from complying with the 3-day mandatory reporting requirement because when he arrived
in the Philippines, his physical condition was already deteriorating and was in need of urgent
medical attention. Thus, it could not be expected of him to prioritize the reporting requirement
before attending to his medical needs. Also, his wife actually notified the petitioners of his medical
condition, through Allan Lopez.

The CA further ruled that Margarito’s cause of death is actually listed as an occupational disease
under the POEA-SEC. While his renal disease is not similarly listed, it is nonetheless disputably
presumed work-related pursuant to Section 32-A (11) of the POEA-SEC. His employment
contributed to the development and exacerbation of his illness considering that he was on board
the vessel for 14months during which he was exposed to stress, different climates and erratic
time zones. The CA declared Margarito’s illness as a total disability since he had to undergo
dialysis three (3) times a week and was in need of regular medical aid that prevented him from
seeking gainful employment.

Accordingly, the respondents’ claims for sickness allowance and permanent disability benefits
were granted. The petitioners moved for reconsideration but the motion was denied in the CA
Resolution.

Arguments of the Parties

The petitioners aver that Margaritois disqualified from claiming any illness benefit on three
grounds: (1) his diabetes is a pre-existing illness which he concealed during his PEME; (2) he
failed to submit himself for post-employment medical examination to the petitioners’ designated
physicians within three (3) days upon his return; and (3) the respondents failed to specifically
allegeor prove by substantial evidence that Margarito’s working conditions has causal relation to
or increased his risk of contracting his illness.

The respondents, on the other hand, contend that the CA correctly awarded Margarito with
permanent disability benefits and sickness allowance. They posit that Margarito acquired his
during the term of his employment with the petitioners. They further argued that Margarito was
very sick when he arrived in the Philippines and thus physically incapable of reporting to the
petitioners’ office for post-employment medical examination. The Respondents denied that
Margarito concealed his illness and claimed that the petitioners’ physicians, who subjected him
to rigid and rigorous PEME, actually found him fit to work. They argued that the compensability of
an illness does not depend on whether it was pre-existing but rather if it is work-related or work-
aggravated which, in this case, was found by the CA to have been substantially established.

ISSUE

Whether or not Margarito’s illness is work-related or not, and thus compensable.

RULING OF THE SUPREME COURT

Margarito’s illness is not work-related, and thus compensable. As a general rule, a medically
repatriated seafarer is required to submit himself to a post-employment medical examination by
the company’s designated physicians within three (3) working days upon his return except when
he is physically incapacitated to do so, in which case a written notice to the agency within the
same period is deemed as compliance. Failure of the seafarer to comply with the mandatory
reporting requirement shall result in his forfeiture of the right to claim the above benefits The
purpose of the rule is to allow the employer’s doctors a reasonable opportunity to assess the
seafarer’s medical condition in order to determine whether his illness is work-related or not.

It is clear from the foregoing facts that Margarito was excused from complying with the 3 day
checkup rule since he was already at a weakened state and needed urgent medical attention.
Moreover, the petitioners have already informed by Margarito’s wife through Allan Lopez, of his
weakened status. In addition, it could be safely assumed that the Petitioners were made aware
of the medical reports of Margarito from UAE.

Nevertheless, Margarito is disqualified from receiving compensation benefits for knowingly

concealing his pre-existing illness of diabetes. Notwithstanding that his failure to report within 3-
days is excusable, Margarito is still disqualified from receiving any compensation or benefits for
his illness because he did not disclose during his PEME that he was suffering from diabetes.
Section 20(E) of the POEA-SEC is clear on this matter, viz:
SECTION 20. COMPENSATION AND BENEFITS
xxxx
E. A seafarer who knowingly conceals and does not disclose past medical condition, disability
and history inthe pre-employment medical examination constitutes fraudulent misrepresentation
and shall disqualify him from any compensation and benefits. This may also be a valid ground for
termination of employment and imposition of the appropriate administrative and legal sanctions.
(Emphasis ours)

The fact that Margarito passed his PEME cannot excuse his willful concealment nor can it
preclude the petitioners from rejecting his disability claims. PEME is not exploratory and does not
allow the employer to discover any and all pre-existing medical condition with which the seafarer
is suffering and for which he may be presently taking medication. The PEME is nothing more than
a summary examination of the seafarer’s physiological condition; it merely determines whether
one is "fit to work" at sea or "fit for sea service" and it does not state the real state of health of an
applicant. The "fit to work" declaration in the PEME cannot be a conclusive proof to show that he
was free from any ailment prior to his deployment.
Thus, for knowingly concealing his diabetes during the PEME, Margarito committed fraudulent
misrepresentation which under the POEA-SEC unconditionally barred his right to receive any
disability compensation or illness benefit.

While cerebrovascular accident which was the proximate cause of Margarito’s death is listed as
an occupational disease under Section 32 of the POEA-SEC and the Implementing Rules and
Regulations of Title II, Book VI of the Labor Code, its compensability, however, must conform to
following additional conditions, viz:
(a) There must be a history, which should be proved, or trauma at work (to the head
specially) due to unusual and extraordinary physical or mental strain or event, or undue
exposure to noxious gases in industry.
(b) There must be a direct connection between the trauma or exertion in the course of
employment and the worker’s collapse.
 (c) If the trauma or exertion then and there caused a brain hemorrhage, the injury may be
considered as arising from work.
Records do not show that these conditions were met. Also, Margarito’s CVA set in a year after he
has been medically repatriated. More importantly, CVA was actually the resulting complication of
his underlying illness of diabetes.

The medical findings presented by both parties uniformly show that Margarito's renal ailment was
contracted as a complication of his diabetes from which he has been suffering for 6 years prior to
his employment with the petitioners.
Thus, it cannot be said that his risk of contracting renal insufficiency or CVA was increased by his
working conditions because irrespective thereof, his complications would have set in because of
his diabetic condition.

25. OLAYBAL vs OSG SHIPMANAGEMENT MANILA, INC

Facts:

Petitioner Olaybal was hired as an "Oiler" by OSG under various contracts from
August 18, 2002 to October 1, 2010. Under his latest contract covering the period from
June7, 2010 to October 1, 2010, he was assigned to Overseas Sakura. The said vessel
was covered by a collective bargaining agreement (CBA)between Olaybal and the
Associate Marine Officers and Seamen’s Union of the Philippines (AMOSUP)providing
better benefits to Filipino shipboard personnel.

In July 2010, while the vessel was travelling from West Africa to Singapore, the ship’s
fresh water generator malfunctioned so the Chief Engineer asked Olaybal and the 3rd
Asst. Engineer to make the necessary repairs. According to Olaybal, the 3rd Asst.
Engineer ordered him to spray SAF acid in order to remove the tartar in the tubes. While
doing so, some of the acid penetrated his eyes causing irritation and itchiness.

The discomfort he felt continued until their vessel arrived in Singapore. Subsequently, he
experienced blurring of his right eye vision but he ignored it and continued performing his
duties. He, then, informed the Chief Engineer of the blurring of his eyesight. Upon his
arrival in China, he wa issued a medical referral report and was diagnosed by the shore
doctor suffering from Retinal Detachment and Cataract and recommended his immediate
6
disembarkation to undergo operation as soon as possible and to avoid working.
Considering that an exit visa was not secured for Olaybal from the Chinese authorities,
he remained on the vessel. He was brought to a hospital in Singapore and diagnosed him
of Retinal Detachment for both eyes. He repatriated on October 7, 2010.

MMS referred Olaybal to its accredited eye specialists who required him to report thrice
a month for check-up, but his visual impairment persisted. In a medical certificate, dated
January 12, 2011, the company-designated physician opined that the treatment for
Olaybal would exceed 120 days and the recovery would depend on his response to the
treatment. He issued the interim assessment of Grade 7-total loss of vision of one eye.

Petitioner underwent a surgical procedure for his right eye. After examination, Dr. Reyes
concluded that his right eye vision was compatible “ to a permanent loss of useful visual
acuity.”

Petitioner filed a permanent disability benefits.

Petitioner’s Contention:

Olaybal contends that his "disability consisting of loss of vision of one eye is
already permanent and total otherwise the company-designated physician could have not
issued the degree of disability of Grade 7 which under the POEA-SEC amounts to ‘total
loss of One Eye or total blindness of one eye.’ Having issued an assessment of degree
of disability to Olaybal, there is no more need to wait for the expiration of the 240-day
period to render the disability permanent and final."

Labor Arbiter’s Decision:

LA granted the disablility claims of the petitioner.

NLRC:

Affirmed the decision of the LA, so far as disability benefit is concerned.

CA:

Reversed the decision of the NLRC. Total blindness of one eye moerits a Grade 7
disability, which is equivalent to 41.80% disability assessment. Under Section 20.1.4 of
the parties’ CBA, it is stipulated that "[a] seafarer whose disability is assessed at 50% or
more under the POEA Employment Contract shall, for the purpose of this paragraph be
regarded as permanently unfit for further sea service in any capacity and entitled to 100%
compensation. Furthermore, any seafarer assessed at less than 50% disability under the
Contract but certified as permanently unfit for further sea service in any capacity by the
company doctor, shall also be entitled to 100% compensation. Also, the CA noted that
the company-designated physician issued an interim assessment if Graede 7 disability to
Olaybal.

Issue:

Whether or not petitioner is entitled to a permanent disability benefit?

Ruling:

NO.

THE DISABILITY IS NOT TOTAL AND PERMANENT

It is the company-designated physician who is entrusted with the task of assessing the
seaman's disability, whether total or partial, due to either injury or illness, during the term
27
of the latter's employment. Indeed, the seafarer has the right to seek the opinion of
other doctors under Section 20-B(3) of the POEA-SEC but this is on the presumption that
the company-designated physician had already issued a final certification as to his fitness
or disability and he disagreed with it.

It is not enough that the seafarer was unable to perform his job and is undergoing medical
treatment for more than 120 days to automatically entitle him to total and permanent
disability compensation. The rule is that a temporary total disability only becomes
permanent when the company-designated physician, within the 240-day period, declares
it to be so, or when after the lapse of the said period, he fails to make such a declaration.
In this case, Olaybal did not go to his scheduled doctor’s appointment which was still
within the 240-day period allowed for the company-designated physician to evaluate his
condition. Instead, he got another doctor’s opinion and filed the case. This is not the
proper procedure for claiming total and permanent disability benefits. If the findings of his
personal doctor were contrary to that of the company-designated physician, the proper
procedure would have been to submit himself to an examination of a third doctor, agreed
upon by him and the OSG, whose opinion shall be final and binding to both parties.
 #25 G.R. No. 190161, October 13, 2014

ANITA N. CANUEL, FOR HERSELF AND ON BEHALF OF HER MINOR CHILDREN, NAMELY: CHARMAINE, CHARLENE, AND CHARL
SMITH, ALL SURNAMED CANUEL, Petitioners, v.MAGSAYSAY MARITIME CORPORATION, EDUARDO U. MANESE, AND KOTANI
SHIPMANAGEMENT LIMITED, Respondents.

On July 14, 2006, Nancing R. Canuel (Nancing) was hired by Magsaysay Maritime Corporation (Magsaysay) as Third Assistant Engineer for
its foreign principal, Kotani Shipmanagement Limited (Kotani), to be deployed on board the vessel M/V North Sea (vessel) for a period of
twelve (12) months.

On February 20, 2007, Nancing met an accident while in the performance of his duties on board the vessel, and injured the right side of his
body.7 On March 5, 2007, he was brought to Shanghai Seamen’s Hospital in Shanghai, China and was diagnosed to have suffered “bilateral
closed traumatic hemothorax.”8 On March 12, 2007, Nancing informed his wife, herein petitioner Anita N. Canuel (Anita), about the accident
and his confinement.9 On March 24, 2007, he was medically repatriated and admitted to the Manila Doctor’s Hospital under the care of Dr.
Benigno A. Agbayani, Jr., Magsaysay’s Medical Coordinator.10 Due to his worsening condition, Nancing was placed at the hospital’s ICU on
April 8, 2007.11 He died on April 25, 2007.12 Nancing’s death certificate13 indicated the immediate cause of his death as acute respiratory
failure, with lung metastasis and r/o bone cancer as antecedent cause and underlying cause, respectively.

On May 23, 2007, Nancing’s widow, Anita, for herself and on behalf of their children, Charmaine, Charlene, and Charl Smith, all surnamed
Canuel (petitioners) filed a complaint14 against Magsaysay and Kotani, as well as Magsaysay’s Manager/President, Eduardo U. Manese
(respondents), before the (NLRC), seeking to recover death benefits, death compensation of minor children, burial allowance, damages, and
attorney’s fees.

Respondents contended that the real cause of his death, as shown in the autopsy conducted by the NBI, was “moderately differentiated
andenocarcinoma, pneumonia and pulmonary edema, lung tissue” or lung cancer. 15 The said illness is not work-related per advise of their
company doctor, Dr. Marie Cherry Lyn Samson-Fernando, hence, not compensable.

the Labor Arbiter (LA) ruled in favor of petitioners and thereby ordered respondents to pay them: (a) death benefits, death compensation for
the three minor children and burial expenses; (b) illness allowance from March 5, 2007 to April 25, 2007; (c) moral damages; (d) exemplary
damages; and (e) 10% of the total award as attorney’s fees.18cralawlawlibrary

The LA found that Nancing’s death occurred during the term of his twelve-month employment contract.19 The evidence supports the
conclusion that his demise was caused by the injury he sustained in an accident while performing his job on board the vessel. LA
disregarded respondents’ contention that lung cancer, a non-work related illness, caused Nancing’s death as it was apparent that it was the
injury he sustained triggered the deterioration of his resistance.

respondents appealed to the NLRC which denied the appeal.

The NLRC ruled that while respondents correctly argued that Nancing’s death did not occur during the term of his employment pursuant to
Section 18 of the Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC) as his employment was
deemed terminated after his medical repatriation, still, it cannot be doubted that his death was brought about by the same or similar cause or
illness which caused him to be repatriated.24

Respondents filed for MR but the same was denied prompting them to elevate the case to the CA on certiorari.29cralawlawlibrary

The CA Ruling

CA dismissed the petitioners’ complaint for death benefits.31Citing the case of Klaveness Maritime Agency, Inc. v. Beneficiaries of the Late
Second Officer Anthony S. Allas (Klaveness),32 it held that the death of the seafarer after the termination of his contract is not compensable,
even if the death is caused by the same illness which prompted the repatriation of the seafarer and the termination of his
contract.33cralawlawlibrary

Petitioners’ motion for reconsideration was denied, hence, this petition.

ISSUE WON the death of Nancing is compensable even if the death occurred after his repatriation.
Petitioners claim that the death of Nancing was compensable because it was the accident he suffered on board the vessel that triggered his
traumatic hemothorax, leading to his acute respiratory failure, and death.37cralawlawlibrary

Respondents aver that since the Nancing’s employment contract was deemed terminated when he was medically repatriated, thus, he was
not entitled to death and other benefits.38 They also maintain that Nancing died of lung cancer which is not a work-related
illness.39cralawlawlibrary

RULING Yes, Nancing’s death is compensable.

The terms and conditions of a seafarer’s employment are governed by the provisions of the contract he signs with the employer at the time of
his hiring. Deemed integrated in his employment contract is a set of standard provisions determined and implemented by the POEA, called
the “Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels,” which provisions are
considered to be the minimum requirements acceptable to the government for the employment of Filipino seafarers on board foreign ocean-
going vessels.40cralawlawlibrary

The provisions currently governing the entitlement of the seafarer’s beneficiaries to death benefits are found in Section 20 of the 2000 POEA-
SEC.

Part A (1) thereof states that the seafarer’s beneficiaries may successfully claim death benefits if they are able to establish that the seafarer’s
death is (a) work-related, and (b) had occurred during the term of his employment contract,

Part A (4) of the same provision further complements Part A (1) by stating the “other liabilities” of the employer to the seafarer’s beneficiaries
if the seafarer dies (a) as a result of work-related injury or illness, and (b) during the term of his employment

First Requirement:

The Seafarer’s Death Should Be Work-Related.

“work-related death” based on Part A (4) means that the said term refers to the seafarer’s death resulting from a work-related injury or
illness. This complements the definition under the 2000 POEA-SEC as follows:

11. Work-Related Injury – injury(ies) resulting in disability or death arising out of and in the course of employment.

12. Work-Related Illness – any sickness resulting to disability or death as a result of an occupational disease listed under
Section 32-A of this contract with the conditions set therein satisfied. (Emphases supplied)

Based on the definition, it is clear that the first requirement for death compensability is present. Nancing suffered a work-related injury within
the term of his employment contract when while performing his duties as Third Assistant Engineer. The foregoing circumstances aptly fit the
legal attribution of the phrase “arising out of and in the course of employment” which the Court, in the early case of Iloilo Dock & Engineering
Co. v. Workmen’s Compensation Commission,42 pronounced as follows:

The two components of the coverage formula – “arising out of” and “in the course of employment” –The words “arising out of” refer to the
origin or cause of the accident, and are descriptive of its character, while the words “in the course of” refer to the time, place, and
circumstances under which the accident takes place.

As a matter of general proposition, an injury or accident is said to arise “in the course of employment” when it takes place within the
period of the employment, at a place where the employee reasonably may be, and while he is fulfilling his duties or is engaged in
doing something incidental thereto. 43 (Emphases supplied; citations omitted)

That Nancing was suffering from lung cancer, which was found to have been pre-existing, hardly impels a contrary conclusion since – as the
LA herein earlier noted – the February 20, 2007 injury actually led to the deterioration of his condition.44 As held in More Maritime Agencies,
Inc. v. NLRC,45 “[i]f the injury is the proximate cause of [the seafarer’s] death or disability for which compensation is sought, [his] previous
physical condition x x x is unimportant and recovery may be had for injury independent of any pre-existing weakness or disease,”

Compensability x x x does not depend on whether the injury or disease was pre-existing at the time of the employment but rather if
the disease or injury is work-related or aggravated his condition. If the injury is the proximate cause of his death or disability for
which compensation is sought, the previous physical condition of the employee is unimportant and recovery may be had for injury
independent of any pre-existing weakness or disease. 46 (Emphases and underscoring supplied)

Clearly, Nancing’s injury was the proximate cause of his death considering that the same, unbroken by any efficient, intervening cause,
triggered the following sequence of events: (a) Nancing’s hospitalization at the Shanghai Seamen’s Hospital47 where he was diagnosed with
“bilateral closed traumatic haemothorax”;48(b) his repatriation and eventual admission to the Manila Doctor’s Hospital;49 and (c)his acute
respiratory failure, which was declared to be the immediate cause of his death.50cralawlawlibrary

Second Requirement:

The Seafarer’s Death Should Occur During The Term Of Employment.

while the general rule is that the seafarer’s death should occur during the term of his employment, the seafarer’s death occurring after the
termination of his employment due to his medical repatriation on account of a work-related injury or illness constitutes an exception thereto.
This is based on a liberal construction of the 2000 POEA-SEC

Here, Nancing’s repatriation occurred during the eighth (8th) month of his one (1) year employment contract. Were it not for his injury, which
had been earlier established as work-related, he would not have been repatriated for medical reasons and his contract consequently
terminated pursuant to Part 1 of Section 18 (B) of the 2000 POEA-SEC:

when the seafarer signs-off and is disembarked for medical reasons pursuant to Section 20 (B)[5] of this Contract, the employment is
deemed terminated.

A strict and literal construction of the 2000 POEA-SEC, especially when the same would result into inequitable consequences against labor,
is not subscribed to in this jurisdiction. Concordant with the State’s avowed policy to give maximum aid and full protection to labor as
enshrined in Article XIII of the 1987 Philippine Constitution,53 contracts of labor, such as the 2000 POEA-SEC, are deemed to be so
impressed with public interest that the more beneficial conditions must be endeavoured in favor of the laborer.54

In the case of Philippine Transmarine Carriers, Inc. v. NLRC:

The POEA SEC for Seamen’s provisions must [therefore] be construed and applied fairly, reasonably and liberally in their favor [as
it is only] then can its beneficent provisions be fully carried into effect.56 (Emphasis supplied)

It is enough that the seafarer’s work-related injury or illness which eventually causes his death should have occurred during the
term of his employment.

The liberal construction of Section 20 of the 2000 POEA-SEC as above-discussed would not offend the Court’s ruling in Klaveness. Upon
careful scrutiny, the seafarer in Klaveness was not medically repatriated but was actually signed off from the vessel after the completion
of his contract. He was subsequently diagnosed to have urinary bladder cancer, which was not proven to be work-related, and died
almost two (2) years after the termination of his contract of employment.

Cases Denying claims for death benefits

In Gau Sheng Phils., Inc. v. Joaquin: the seafarer died of chronic renal failure which was not listed as a compensable illness.

In Aya-ay, Sr. v. Arpaphil Shipping Corp.,60 the repatriation was due to an eye injury but subsequently died of a stroke

In Hermogenes v. Osco Shipping Services, Inc.,61 no evidence was offered to prove the cause of the termination of the contract of
employment, whereas it was found that the seafarer therein died three (3) years after his disembarkation of an illness which was not shown
to have been contracted during his employment.

In Prudential Shipping and Management Corp. v. Sta. Rita,62 the seafarer was repatriated due to umbilical hernia but died one (1) year after
of cardiopulmonary arrest, which was not, however, established as work-related.

In Ortega v. CA,63 considering that the seafarer therein died of lung cancer which was not found to be work-related.

Cases granting death benefits although death had occurred after their repatriation primarily because of the causal connection between their
work and the illness which had eventually resulted in their death.

In Wallem Maritime Service, Inc. v. NLRC,64 there is “reasonable connection” between the seafarer’s job and his illness. It is enough that
the employment had contributed, even in a small degree, to the development of the disease and in bringing about his death.

In Seagull Shipmanagement and Transport, Inc. v. NLRC66 –what matters is that his work had contributed, even in a small degree, to
the development of the disease and in bringing about his eventual death. If the disease is the proximate cause of the employee’s
death for which compensation is sought, the previous physical condition of the employee is unimportant, and recovery may be had
for said death, independently of any pre-existing disease. 67
In Interorient Maritime Enterprises, Inc. v. Remo,68 a 2010 case decided under the 1996 POEA-SEC which operated under parameters
identical to the 1984 POEA-SEC. the seafarer’s death, even if it occurred months after his repatriation, due to hypertensive cardio-
vascular disease, could clearly have been work related. Declared as “fit to work” at the time of hiring, and hospitalized while on service
on account of “atrial fibrillation and congestive heart failure,” his eventual death due to “hypertensive cardio-vascular disease” could only be
work related.

In Inter-Orient Maritime, Incorporated v. Candava,70 the seafarer’s death, despite occurring after his repatriation, remains “compensable for
having been caused by an illness duly established to have been contracted in the course of his employment.”71cralawlawlibrary

If the seafarer’s work-related injury or illness (that eventually causes his medical repatriation and, thereafter, his death, as in this
case) occurs during the term of his employment, then the employer becomes liable for death compensation benefits under Section
20 (A) of the 2000 POEA-SEC. The provision cannot be construed otherwise for to do so would not only transgress prevailing constitutional
policy and deride the bearings of relevant case law but also result in a travesty of fairness and an indifference to social justice.
# 26 G.R. No. 203804, April 15, 2015

DARIO A. CARCEDO (SUBSTITUTED BY HIS WIFE PRISCILLA DELA CRUZ-CARCEDO), Petitioner, v. MAINE MARINE PHILIPPINES,
INC. AND/OR MISUGA KAJUN CO., LTD., AND/OR MA. CORAZON GEUSE-SONGCUYA, Respondent.

FACTS

On 6 August 2008, Dario A. Carcedo (Carcedo) was hired as Chief Officer by Maine Marine Philippines, Inc. for its foreign principal Misuga
Kajun Co., Ltd. (collectively, respondents). His contract was for nine months and boarded the vessel on Aug 10 2008.

In November 2008, Carcedo’s foot was wounded because of his safety shoes. The ship doctor gave him antibiotics and allowed him to
resume work.7 His foot’s condition worsened when he slid down the deck and bumped his right foot. In January 2009, he felt pain in the back
of his swollen leg and developed fever and headache.

On 19 January 2009, he was treated at the Yoshino Hospital in Japan and he was diagnosed with an open fracture of the right major toe
bone with a suspicion of sepsis.8

Carcedo was repatriated on 20 January 2009. He was immediately referred to the company-designated physician, Dr. Nicomedez Cruz of
the Manila Doctors Hospital. Carcedo underwent a debridement of the wound of the right big toe. Dr. Cruz’s diagnosis are:

1. Infected wound with gangrene, right big toe

2. S/P Debridement
3. Diabetes mellitus10
4. Carcedo also underwent disarticulation of the right big toe on 26 January 2009.11 He was discharged from the hospital on 12
February 2009.12

On 24 March 2009, Dr. Cruz recommended “an impediment disability grading of 8% Loss of first toe (big toe) and some of its metatarsal
bone.”13

Due to infection of the amputated stump, Carcedo was again admitted to the hospital on 20 April 2009 for intravenous antibiotics.14 Carcedo
underwent: sequestrectomy of the right first metatarsal bone; curettage and serial debridements of the wound; removal of right first
metatarsal bone and was on 6 June 2009, He is advised to continue daily wound care. On his follow-up consultation, Dr. Cruz noted that
there is x x x good granulation tissue on the stump of amputated right big toe. The wound is open but with slight yellowish discharge. He was
advised to continue his medications.19

On 21 October 2009, Carcedo filed a complaint20 for total and permanent disability benefits, sickness allowance and other consequential
damages.

Meanwhile, Carcedo consulted orthopedic surgeon, Dr. Alan Leonardo R. Raymundo, who amputated Carcedo’s second toe. Dr. Raymundo
reported that he now has absence of the first and second toe which is prompting him to walk on the lateral aspect of his left foot with a cane.
He was recommended not fit to return to his previous work duties as a chief mate on board. 22

Carcedo averred: (1) his injury was work-related because he sustained the wound from his safety shoes at work, hence, his injury was
compensable under Section 20(B) of the POEA SEC; (2) his disability was total and permanent; the injury on his leg was so severe that
despite medication, there was no certainty that his former physical condition would get restored and he could resume his customary work; he
walked with difficulty and not without a cane; with the recommendation of his doctor that he is not fit to return to his previous work duties as a
chief mate on board”; (3) he suffered severe depression and anxiety, for which, he was entitled to moral and exemplary damages, and
attorney’s fees; his employer’s refusal to pay his disability benefits showed evident bad faith; and, he was denied a better medical treatment
because he had to make do with what his depleted resources could afford.

Maine posited: that (1) they were bound by the provisions on disability compensation under the POEA Standard Employment Contract and
CBA; the disability compensation schedule under the IBF-JSU/AMOSUP IMMAJ CBA Schedule of Disability and Impediment

the CBA further stated:

28.4 The Company shall provide disability compensation to the seafarer in accordance with APPENDIX 3, with any differences, including
less than ten percent (10%) disability, to be pro rata;

since Carcedo’s injury fell under ‘Loss of 1st toe (big toe) and some of its metatarsal bone,[’] his rate of compensation was equivalent to 8%
(2) the disability assessment of the company-designated physician should be given utmost credence, instead of his doctor;

(3) it had not acted in bad faith and had dealt fairly with Carcedo;

The Ruling of the Labor Arbiter

the LA denied Carcedo’s claim for full disability and awarded him only partial disability in accordance with the contract between the parties.
The Labor Arbiter held that the contract between the parties is the law between them.

The Ruling of the NLRC

On appeal, the NLRC reversed LA’s decision and awarded Carcedo full disability benefits and attorney’s fees. The NLRC gave credence to
the findings of Dr. Raymundo, and held that Carcedo’s death was confirmation of his unfitness to do work as a seaman. 27 The NLRC applied
the definition of permanent disability enunciated by the Court in the case of Crystal Shipping Inc. v. Natividad,28 which was “the inability of a
worker to perform his job for more than 120 days, regardless of whether or not he loses the use of any part of his body.”29

NLRC denied the MR. Hence, this Petition before the CA.

The Ruling of the Court of Appeals

The Court of Appeals upheld the 8% disability grading made by the company-designated physician in accordance with the CBA. However,
the Court of Appeals also declared Carcedo to be suffering from total and permanent disability because (1) he was unable to perform his job
for more than 120 days; and (2) the declarations by the company-designated physician that Carcedo was fit for sea duty were made more
than 400 days from repatriation.

The Issue

WON Carcedo only be awarded Total and Permanent Disability Benefits in accordance with the Collective Bargaining Agreement only

The Court’s Ruling

We grant the petition in part.

Entitlement to Disability Benefits

A contract is the law between the parties, which in this case are the CBA and the POEA-SEC.

Based on the CBA, there are three instances when a seafarer may be entitled to 100% disability compensation. These are: (1) when the
seafarer is declared to have suffered 100% disability; (2) when the seafarer is assessed with disability of at least 50%; and (3) when the
seafarer, while assessed at below 50% disability, is certified as permanently unfit for sea service.

According to the CBA, both the disability assessment and the certification as permanently unfit for sea service are to be given by the
company-designated physician. These can be overruled by a third doctor jointly appointed by the company and the union, in the event that
the seafarer’s personal physician disagrees with the evaluations of the company-designated physician. Section 20(B)(3) of the POEA-SEC
provides a similar mechanism for determining the disability assessment.35

However, it is not only the contract between the parties that governs the determination of the disability compensation due the
seafarer. The provisions on disability of the Labor Code and the Amended Rules on Employee Compensation (AREC)
implementing Title II, Book IV of the Labor Code are applicable to the case of seafarers.

Labor Code (Article 192(c)(1), Chapter VI, Title II, Book IV):

Art. 192. Permanent and total disability.

xxxx

(c) The following disabilities shall be deemed total and permanent:

(1) Temporary total disability lasting continuously for more than one hundred twenty days, except as otherwise provided for in the
Rules[.] (Emphasis supplied)

Section 2(b) of Rule VII of AREC:

SECTION 2. Disability. x x x

(b) A disability is total and permanent if as a result of the injury or sickness the employee is unable to perform any gainful occupation for a
continuous period exceeding 120 days, except as otherwise provided for in Rule X of these Rules. (Emphasis supplied)

The above rule pertains to Section 2, Rule X of the AREC:

SECTION 2. Period of entitlement. (a) The income benefit shall be paid beginning on the first day of such disability. If caused by an injury
or sickness it shall not be paid longer than 120 consecutive days except where such injury or sickness still requires medical
attendance beyond 120 days but not to exceed 240 days from onset of disability in which case benefit for temporary total disability
shall be paid. However, the System may declare the total and permanent status at any time after 120 days of continuous temporary
total disability as may be warranted by the degree of actual loss or impairment of physical or mental functions as determined by
the System. (Emphasis supplied)

These provisions, in conjunction with Section 20(B)(3) of the POEA-SEC, were interpreted in the case of Vergara v. Hammonia Maritime
Services, Inc.38 thus:

As these provisions operate, the seafarer, upon sign-off from his vessel, must report to the company-designated physician within three (3)
days from arrival for diagnosis and treatment. For the duration of the treatment but in no case to exceed 120 days, the seaman is on
temporary total disability as he is totally unable to work. He receives his basic wage during this period until he is declared fit to work or his
temporary disability is acknowledged by the company to be permanent, either partially or totally, as his condition is defined under the POEA
Standard Employment Contract and by applicable Philippine laws. If the 120 days initial period is exceeded and no such declaration is
made because the seafarer requires further medical attention, then the temporary total disability period may be extended up to a
maximum of 240 days, subject to the right of the employer to declare within this period that a permanent partial or total disability
already exists. The seaman may of course also be declared fit to work at any time such declaration is justified by his medical condition.39
(Emphasis supplied)

Hence, a partial and permanent disability could, by legal contemplation, become total and permanent. The Court in Kestrel Shipping Co., Inc.
v. Munar40 held that the declaration by the company-designated physician is an obligation, the abdication of which transforms the temporary
total disability to permanent total disability, regardless of the disability grade, viz:

Indeed, under Section 32 of the POEA-SEC, only those injuries or disabilities that are classified as Grade 1 may be considered as total and
permanent. However, if those injuries or disabilities with a disability grading from 2 to 14, hence, partial and permanent, would incapacitate a
seafarer from performing his usual sea duties for a period of more than 120 or 240 days, depending on the need for further medical
treatment, then he is, under legal contemplation, totally and permanently disabled. In other words, an impediment should be characterized as
partial and permanent not only under the Schedule of Disabilities found in Section 32 of the POEA-SEC but should be so under the relevant
provisions of the Labor Code and the Amended Rules on Employee Compensation (AREC) implementing Title II, Book IV of the Labor Code.

Assessment of Disability Grading

We cannot agree with the Court of Appeals and the Labor Arbiter that the 24 March 2009 disability assessment made by Dr. Cruz was
definitive. The said disability assessment was an interim one because Carcedo continued to require medical treatments even after 24 March
2009. He was confined in the hospital from 20 April 2009 to 6 June 2009, where he underwent serial debridements, curettage,
sequestrectomy and even amputation of the right first metatarsal bone. He was certainly still under total disability, albeit temporary at that
time.

His discharge from the hospital was 137 days from repatriation. Following the Court’s rulings in Vergaraand Kestrel, since Carcedo required
further medical treatments beyond the 120 day period, his total and temporary disability was extended. The company-designated physician
then had until 240 days from repatriation to give the final assessment.

During the follow-up consultation (146 days from repatriation), Dr. Cruz noted that Carcedo’s wound was still open and that he was to
continue his medications.42 Carcedo’s injury required tending. Dr. Cruz still had nearly 100 days within which to give Carcedo’s final disability
assessment, yet he gave none.
Indeed, the schedule of disabilities in the CBA, if there is one, or the POEA-SEC, should be the primary basis for the determination of a
seafarer’s degree of disability. However, the POEA-SEC and the CBA cannot be read in isolation from the Labor Code and the AREC.
Otherwise, the disability rating of the seafarer will be completely at the mercy of the company-designated physician, without redress, should
the latter fail or refuse to give one.

Here, the company-designated physician failed to give a definitive impediment rating of Carcedo’s disability beyond the extended temporary
disability period, after the 120-day period but less than 240 days. By operation of law, therefore, Carcedo’s total and temporary disability
lapsed into a total and permanent disability.43

Even assuming that Dr. Cruz’s 24 March 2009 disability rating were definitive, Carcedo would still have a cause of action for total and
permanent disability compensation. Dr. Cruz’s declaration of 8% impediment rating was made 63 days from repatriation, within the 120-day
period. However, beyond this period, Carcedo was still incapacitated to perform his usual sea duties as he was still undergoing medical
treatments and was confined in the hospital.

Certification of Fitness for Sea Service

Neither was there a certification from the company-designated physician as to Carcedo’s fitness for sea service.

Dr. Cruz’s 24 March 2009 report on the disability grading of Carcedo did not include a certification that he was already fit for sea duty.
However, in Respondents’ Reply to Complainant’s Position Paper, they wrote:

xxxx

b. Medical Director and PEME doctor Dr. Fe Bacungan clearly opined that complainant’s amputated right big toe will not in any way
interfere with his current position as Chief Officer on board.

c. Another PEME doctor Dr. Pascualito Gutay likewise opined that complainant’s current condition will not render him unfit for further sea
duties as Chief Officer onboard.

x x x x46

The Court of Appeals considered the opinions of Dr. Bacungan and Dr. Gutay as fit for sea duty declarations of respondents’ designated
physicians. We disagree. These opinions are not the certifications of fitness for sea duty contemplated by the CBA and the POEA-SEC. First,
Dr. Bacungan and Dr. Gutay were not the company-designated physicians assigned to the care of Carcedo. Second, they were given in
response to a hypothetical inquiry by respondents’ counsel.47 Third, neither doctor examined Carcedo in coming up with their opinions.

Hence, we also disagree with the NLRC’s giving credence to the declaration of Dr. Raymundo that Carcedo was unfit to work as a seaman.

Carcedo consulted Dr. Raymundo more than nine months since repatriation, and four months since he last consulted the company-
designated physician. During the latter period, Carcedo could have developed any number of conditions that may or may not be related to
the injury suffered while on board the ship. Notably, Dr. Raymundo’s medical report does not specify what “condition” of Carcedo was “still in
the healing process.”48

In addition, Dr. Raymundo was only consulted after Carcedo was treated by the company-designated physician. Dr. Raymundo did not have
a chance to observe Carcedo from the time of his repatriation, and was not able to monitor his condition throughout the treatments.

Besides, Dr. Raymundo’s disability assessment includes a second ray amputation which he performed on Carcedo. This, and the amputation
of the first toe and its metatarsal bone performed by the company-designated physician, formed the basis of Dr. Raymundo’s unfit for sea
duty declaration. In contrast, the injury diagnosed by the doctor at the Yoshino Hospital in Japan and the initial findings of Dr. Cruz
immediately upon repatriation only pertain to the first toe. Apart from the vague mention of a condition that was still in the healing process,
there was no indication that the second ray amputation was a consequence of the injury sustained while on board.

Nevertheless, Carcedo’s disability is deemed total and permanent due to the lack of a final disability assessment and of a certification of
fitness for sea service from Dr. Cruz.

Disability Compensation Due

Based on the foregoing discussion, we hold that Carcedo is entitled to full disability compensation.

Moral and Exemplary Damages

 and Attorney’s Fees

The Court of Appeals did not award moral and exemplary damages but deleted the award of attorney’s fees. This sustains.

attorney’s fees may be awarded if petitioner acted in gross and evident bad faith in refusing to satisfy plaintiff’s plainly valid, just and
demandable claim.

Here [respondents] did not act in bad faith because they paid all Carcedo’s treatment and hospitalization expenses. They even offered to pay
disability benefits, albeit, Carcedo refused it because he wanted Grade 1, no less. Too, the assailed decision did not explain the basis for the
award of attorney’s fees.50

A Final Note

In this case, the third-doctor-referral provision did not find application because of the lack of a definitive disability assessment by the
company-designated physician.

At that point in time, the parties were yet before the Labor Arbiter, who could have facilitated the election of the third doctor. We would like to
remind ship owners, manning companies and seafarers of their respective obligations as regards the third doctor provision. In INC
Shipmanagement, Incorporated v. Rosales, we held:

To definitively clarify how a conflict situation should be handled, upon notification that the seafarer disagrees with the company doctor’s
assessment based on the duly and fully disclosed contrary assessment from the seafarer’s own doctor, the seafarer shall then signify his
intention to resolve the conflict by the referral of the conflicting assessments to a third doctor whose ruling, under the POEA-SEC, shall be
final and binding on the parties. Upon notification, the company carries the burden of initiating the process for the referral to a third doctor
commonly agreed between the parties.

The decision of NLRC is reinstated with modification.

#27 G.R. No. 196357, April 20, 2015

THE HEIRS OF THE LATE DELFIN DELA CRUZ, REPRESENTED BY HIS SPOUSE, CARMELITA DELA CRUZ, Petitioners, v.
PHILIPPINE TRANSMARINE CARRIERS, INC., REPRESENTED BY MR. CARLOS C. SALINAS AND/OR TECTO BELGIUM N.V.,
Respondent.

The facts:

Delfin Dela Cruz was contracted as Oiler by Philippine Transmarine Carriers[,] Inc., in behalf of Tecto Belgium N.V.[,] under the following
terms and conditions as provided for in the Contract of Employment:

[His] work includes observing routine watch, taking records of pressure of temperature of all working apparatus, obeying all orders and
commands of the engineers, and maintaining cleanliness of machinery and engine room.

[Delfin] left the Philippines on 16 August 2000 and immediately embarked the vessel "Lady Hilde" on 17 August 2000. While on board, he felt
gradual chest pains and pain [in] his upper abdominal region. On 26 [June] 2001, while performing his regular duties, he was hit by a metal
board on his back. He, thereafter, requested medical attention and was given medications and advised to be given light duties for the rest of
the week. On 16 August 2001, his contract expired and [he] was signed off from the vessel. He also sought medical assistance but was not
[extended] such.

On 13 November 2003, [Delfin] went to De Los Santos Medical Center for proper medical attention[.] He underwent X-Ray and MRI of the
[Thoracic] Spine. He was not employed by xxx [respondents] because he was already incapacitated to engage in his customary work. He
filed his claim for sickness allowance from the same manning agency but the same was not [granted].

His [condition] deteriorated and was admitted at St. Luke's Medical Center. He was diagnosed with [malignant] peripheral nerve sheath tumor
[MPNST]. He shouldered his medical expenses x x x.

On 4 December 2003, he filed a complaint before the NLRC to, claim payment for sickness allowance and disability compensation. x x x

[Respondents] filed [a] Motion to Dismiss on the ground of prescription, having [been] filed beyond one year from the date of the termination
of the contract. [Delfin] countered x x x that the prescription period is 3 years, according to the POEA Standard Employment Contract.

[Delfin] calimed that he is entitled to sickness allowance because of the incident when he was hit by a metal board on his back, which
required medical attention. He averred that he is entitled [to] sickness allowance because his inability to work and perform his usual
occupation after he acquired the sickness while on board, lasted for more than 120 days. This is also the basis of his claim for permanent
disability compensation. [Delfin] also claimed for attorney's fees and moral damages

[Respondents] averred that:

· the medical condition of [Delfin] was not acquired during his employment, that said medical condition is not work-related,

· more than two years had elapsed from the time of the termination of [Delfin's] employment up to the time the claim was filed, and
thus the illness was not acquired during the period of employment. [

· the company[-]designated physician neither issued any certification as regards the medical condition of [Delfin] nor conducted a
post[-] employment medical examination, after he was discharged from the vessel in.

On 6 May 2005, Pelfin] passed away, x x x7

Ruling of the Labor Arbiter (LA)

LA rendered a Decision in favor of Delfin. The LA opined that Delfin contracted his illness during the period of his employment and that such
illness is a compensable occupational disease.

Ruling of the National Labor Relations Commission

the NLRC reversed the Decision of the LA. It found Delfin's claims to be barred by prescription for having been filed beyond the reglementary
period of one year from the termination of the employment contract. The NLRC also found no evidence that would establish a causal
connection between Delfrn's ailment and his working conditions.

Ruling of the Court of Appeals

petitioners filed a Petition for Certiorari12 with the CA.

CA held that the Complaint was filed within the reglementary period of three years from the date the cause of action arose, as provided for in
Section 30 of the (POEA SEC). Nonetheless, the CA sustained NLRC's pronouncement that petitioners are not entitled to disability
compensation as they failed to establish that Delfin's illness was work-related. According to the CA, Delfrn's illness, which is known as
Malignant Peripheral Nerve Sheath Tumor (MPNST), is a type of soft tissue sarcoma that develops in cells that form a protective sheath
(covering) around peripheral nerves. Peripheral nerves are those that radiate from the brain and spinal cord and stimulate the muscles.
However, aside from the June 26, 2001 incident where Delfin was hit by a metal board on his back, there was no other reported incident that
would reasonably connect Delfrn's ailment to his working condition. Petitioners could only offer their allegations that Delfin experienced chest
pains without, however, presenting proofs in support thereof. The CA also found notable that it was only on November 13, 2003 or two years
after the termination of his contract and repatriation when Delfin went to Delos Santos Medical Center for medical check-up and underwent
chest x-ray and MRI of the thoracic spine.

CA also denied petitioners' claim for sickness allowance considering that Delfin's contract with respondents had long expired. It likewise
denied petitioners' claim for attorney's fees, moral damages and exemplary damages

Thus, the present Petition for Review on Certiorari.

Issues WON [petitioners are] entitled to permanent disability benefits and sickness allowance;

Ruling

The petition lacks merit.

Petitioners are not entitled to permanent disability benefits and sickness allowance.

Section 20 (B) of the 1996 POEA SEC reads as follows:

SECTION 20. COMPENSATION AND BENEFITS

xxxx

B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS:

The liabilities of the employer when the seafarer suffers injury or illness during the term of his contract are as follows:

xxx

1996 POEA SEC covers all injuries or illnesses occurring in the lifetime of the employment contract.22 The seafarer only has to prove that his
injury or illness was acquired during the term of employment to support his claim for disability benefits and sickness allowance.23 Verily, his
injury or illness need not be shown to be work-related to be compensable under said employment contract.24

However, "whoever claims entitlement to the benefits provided by law should establish his right to the benefits by substantial evidence"25 or
"such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other equally reasonable minds
might conceivably opine otherwise."26 Absent a showing thereof, any decision set forth will only be based on unsubstantiated allegations.
Accordingly, the Court cannot grant a claim for disability benefits without adequate substantiation for to do so will offend due process.27

An examination of the records, however, shows that petitioners failed to discharge such burden.

The 1996 POEA SEC clearly provides that a seafarer must submit himself to a post-employment medical examination within three days from
his arrival in the Philippines (mandatory reporting requirement) so that his claim for disability and sickness allowance can prosper.29 The only
exception to this rule is when the seafarer is physically incapacitated to do so, but there must be a written notice to the agency within the
same period of three days for the seaman to be considered to have complied with the requirement. 30Otherwise, he forfeits his right to claim
his disability benefits and sickness allowance.31 In Manota v. Avantgarde Shipping Corporation.32 the Court explained the rationale behind
the three-day period requirement, thus:

The 3-day mandatory reporting requirement must be strictly observed since within 3 days from repatriation, it would be fairly manageable for
the physician to identity whether the disease x xx was contracted during the term of his employment or that his working conditions increased
the risk of contracting the ailment.
it is required to ascertain [the seafarer's] physical condition, since to ignore the rule would set a precedent with negative repercussions
because it would open the floodgates to a limitless number of seafarers claiming disability benefits. It would certainly be unfair to the
employer who would have difficulty determining the cause of a claimant's illness considering the passage of time. In such a case, the
employers would have no protection against unrelated disability claims.

Here, petitioners claim that Delfin went to respondents to comply with the mandatory reporting requirement and to seek medical assistance
but his request for medical evaluation was unheeded. Petitioners, however, failed to support this.33

In this case, petitioners failed to show the steps supposedly undertaken by Delfin to comply with the mandatory reporting requirement. To the
Court's mind, this lapse on petitioners' part only demonstrates that Delfin did not comply with what was incumbent upon him. The reasonable
conclusion, therefore, is that at the time of his repatriation, Delfin was not suffering from any physical disability requiring immediate medical
attendance. Otherwise, and even if his request for medical assistance went unheeded, he would have submitted himself for check-up with his
personal physician. Clearly, petitioners failed to show that Delfin complied with the mandatory reporting requirement. Thus, he is deemed to
have forfeited his right to claim disability benefits and sickness allowance.

Even assuming that there was compliance with the mandatory reporting requirement, other factors that strongly militate against the granting
of petitioners' claims exist in this case.

First, while petitioners did present a medical certificate dated June 26, 2001 which was issued while Delfin was still employed with
respondents, nothing therein shows that the incident subject thereof has something to do or is related to MPNST - the injury or illness which
caused Delfin's disability. Specifically, said certificate pertains to a blow on Delfin's back caused by a metal board and for which he
complained of "persistent pain in the chest and upper abdominal region." For this, Delfin was advised to undertake only "light duties for [the]
rest of [the] week" and that "if not settled[,] will need reassessment]." On the other hand, the injury that showed up in his chest x-ray and MRI
for which he claimed compensation pertains to a different portion of his body, i.e., a fracture in one of his ribs.35 Besides, if indeed there is
truth to petitioners' assertion that Delfin continued to experience pain after he was hit by a metal board on his back, then why did he not
request for reassessment as advised or submit himself to the mandatory reporting requirement after he was repatriated? What is glaring
instead is that against all these, petitioners only offered their bare allegation that Delfin's medical condition did not improve thereafter.

Second, while Delfin averred that he experienced on-and-off pain even prior to the June 26, 2001 incident, there exists no record thereof. On
the contrary, Delfin himself claimed that despite the pain, he "remained calm and unbothered by the same."36

Third, it is also interesting to note that although petitioners did submit Delfin's chest x-ray and MRI results37 revealing a fracture in one of his
ribs, it must be emphasized that these findings were issued more than two years after his repatriation. Worse still, the Clinical Abstract
submitted by petitioner was undated38 such that it cannot be determined when the said document was released. Be that as it may, it can be
safely concluded that the said clinical abstract was issued in or after 2004 since it contained a detailed history of Delfin's illness starting from
his having been diagnosed with MPNST in 2003, and an enumeration of his documented episodes of pathologic fractures occurring in May
2002, December 2003 and April 2004. These only highlight the fact that a considerable period of time had passed from Delfin's repatriation in
August 2001 up to the time that he started to suffer pathologic fractures in May 2002. Thus, it cannot be said that Delfin's rib fracture subject
of the above-mentioned chest x-ray and MRI was caused by the blow on his back of the metal sheet that fell on him as petitioners would
want to impress upon this Court. On the other hand, what is more likely under the circumstances is that the fracture came about after his
repatriation. For one, the report contained in Delfin's clinical abstract is telling, viz:

Patient is a diagnosed case of Malignant Peripheral Nerve Sheath Tumor. (2003 SLMC)[.] He also had several episodes of
pathologic fractures: x x x

Sixteen hours prior to admission, while in bed, trying to change position, patient suddenly heard a cracking [sound], which was
followed by shooting pain on the left thigh, intermittent, localized, aggravated by movement, with no alleviating factors, x x x (Emphases
supplied)39

Notably, MPNST, of which Delfin was diagnosed with more than two years after his repatriation, causes pathologic fractures. 40 And since
Delfin is prone to pathologic fractures because of MPNST, it is quite possible that any wrong movement of his body may cause fracture
similar to what happened to him as narrated in the clinical report. As to the cause of MPNST, again, it bears stating at this point that
petitioners failed to show that the same has any connection with the accident figured in by Delfin while he was on board the vessel.

Fourth, the Court notes that Delfm's Position Paper filed with the Labor Arbiter contained vague and ambiguous allegations of two purported
compensable illnesses, viz:

The record of the case will reveal that complainant is suffering from two (2) compensable sicknesses, one (1) affecting his abdomen and two
(2) affecting his back down to his legs.41
However, in the Rejoinder later filed by him with the same tribunal, he drastically changed such theory by claiming that he instead suffers
from MPNST.42 "It has been held that a party will not be allowed to make a mockery of justice by taking inconsistent positions which, if
allowed, would result in brazen deception."43

Lastly, this Court deems it proper to reiterate its ruling in Quizora v. Denholm Crew Management (Philippines), Inc. 44on the relevance of the
seafarer's passing his PEME

The PEME merely determines whether one is "fit to work" at sea or "fit for sea service," it does not state the real state of health of an
applicant. In short, the "fit to work" declaration in the respondent's PEME cannot be a conclusive proof to show that he was free
from any ailment prior to his deployment. Thus we held in NYK-FIL Ship Management, Inc. v. NLRC:

While a PEME may reveal enough for the petitioner (vessel) to decide whether a seafarer is fit for overseas employment, it may not
be relied upon to inform petitioners of a seafarer's true state of health. The PEME could not have divulged respondent's illness
considering that the examinations were not exploratory. (Emphases supplied)

Hence, the fact that Delfin passed his PEME is of no moment in this case.

28. G.R. No. 184933

VIOLETA BALBA, for and in behalf of her minor children ROY VINCE and VIENNA GRACIA, both surnamed Balba,
Petitioners,

vs.

TIWALA HUMAN RESOURCES, INC., AND/OR TOGO MARITIME CORP., Respondents.

DECISION

REYES, J.:

FACTS:
Sometime in 1998, Rogelio entered into a 10-month contract of employment with Tiwala Human Resources, Inc. for its foreign
principal, Togo Maritime Corporation (respondents), wherein he was employed as chief cook on board the vessel M/V Giga Trans. 7
He was declared fit for work in his pre-employment medical examination and boarded the vessel M/V Giga Trans on November 13,
1998. Upon the expiration of his contract, Rogelio was repatriated to the Philippines in October 1999.

From October to November 1999, Rogelio was treated by Dr. Benito Dungo (Dr. Dungo) for weakness and numbness of his left half
body and lower extremities and was diagnosed to be suffering from moderately severe diabetes.

In 2000, Rogelio was confined at the Seamen's Hospital and was found to have metastatic cancer. As such, he sought disability
compensation and benefits from the respondents but these were denied.

Consequently, Rogelio filed on April 6, 2000 a complaint against the respondents for disability benefits with damages and attorney's
fees.

On April 28, 2000, however, Rogelio was admitted at the Philippine General Hospital for lung cancer.

He succumbed to his illness in July 2000. As a result of Rogelio's death, his complaint was subsequently amended and his wife,
Violeta Balba, and two children, Roy and Vienna Gracia, were substituted as complaints.

LA September 25, 2002 - the complaint was dismissed after finding that Rogelio's death was not compensable under the Philippine
Overseas Employment Administration Standard Employment Terms and Conditions.

NLRC December 28, 2004 - reversed the LA's Decision and declared that Rogelio contracted his illness while on board the vessel
and during the existence of his contract.

CA May 31, 2007- granted the petition of respondent. It declared that the evidence on record is bereft of any proof linking Rogelio's
cancer with his work as chief cook

ISSUE: Whether or not the petitioners are entitled to death and burial benefits on account of Rogelio's death.

RULING: NEGATIVE

Taking into consideration that Rogelio was employed on November 13, 1998, it is the 1996 Revised POEA-SEC that is considered
incorporated in his contract of employment and is controlling for purposes of resolving the issue at hand.

Section 20(A) of the 1996 Revised POEA-SEC provides that in order to avail of death benefits, the death of the seafarer must be
work-related and should occur during the effectivity of the employment contract. The provision reads:

SECTION 20. COMPENSATION AND BENEFITS

A. COMPENSATION AND BENEFITS FOR DEATH

1. In case of death of the seafarer during the term of his contract, the employer shall pay his beneficiaries the Philippine Currency
equivalent to the amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars
(US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange rate prevailing during
the time of payment.

xxxx

4. The other liabilities of the employer when the seafarer dies as a result of injury or illness during the term of employment are as
follows:
a. The employer shall pay the deceased's beneficiary all outstanding obligations due the seafarer under this Contract.
b. The employer shall transport the remains and personal effects of the seafarer to the Philippines at employer's expense
except if the death occurred in a port where local government laws or regulations do not permit the transport of such remains.
In case death occurs at sea, the disposition of the remains shall be handled or dealt with in accordance with the master's
best judgment. In all cases, the employer/master shall communicate with the manning agency to advise for disposition of
seafarer's remains.
c. The employer shall pay the beneficiaries of the seafarer the Philippine currency equivalent to the amount of One Thousand US
dollars (US$1,000) for burial expenses at the exchange rate prevailing during the time of payment.

In the present case, it is undisputed that Rogelio succumbed to cancer on July 4, 2000 or almost ten (10) months after the expiration
of his contract and almost nine (9) months after his repatriation. Thus, on the basis of Section 20(A) and the above-cited jurisprudence
explaining the provision, Rogelio's beneficiaries, the petitioners, are precluded from receiving death benefits.

Moreover, even if the Court considers the possibility of compensation for the death of a seafarer occurring after the termination of the
employment contract on account of a work-related illness under Section 32(A) of the POEA-SEC, the claimant must still fulfill all the
requisites for compensability, to wit:
1. The seafarer's work must involve the risks described herein;
2. The disease was contracted as a result of the seafarer's exposure to the described risks;
3. The disease was contracted within a period of exposure and under such other factors necessary to contract it;
4. There was no notorious negligence on the part of the seafarer. 29

In the present case, the petitioners failed to adduce sufficient evidence to show that Rogelio's illness was acquired during the term of
his employment with the respondents. Instead, what the petitioners presented were medical certificate issued by Dr. Dungo dated
November 12, 1999 attesting that Rogelio consulted him due to weakness and numbness of Rogelio's left half body and lower
extremities and medical examination results in March and April 2000 showing that he had cancer. The Court, however, finds it not
sufficient proof to show a causal connection or at least a work relation between the employment of Rogelio and his cancer. In the
absence of substantial evidence, Rogelio's working conditions cannot be assumed to have increased the risk of contracting cancer.

In the instant case, Rogelio was repatriated not because of any illness but because his contract of employment expired. There is
likewise no proof that he contracted his illness during the term of his employment or that his working conditions increased the risk of
contracting the illness which caused his death.

Based on these considerations, it is apparent that the instant petition is without merit and that the CA was correct when it reversed
and set aside the NLRC award of death benefits to the petitioners as heirs of Rogelio. While the Court adheres to the principle of
liberality in favor of the seafarer in construing the POEA-SEC, we cannot allow claims for compensation based on surmises. When
the evidence presented negates compensability, the Court has no choice but to deny the claim, lest we cause injustice to the
employer.

29. G.R. No. 220608, August 31, 2016

MARCELINO T. TAMIN, Petitioner, v. MAGSAYSAY MARITIME CORPORATION AND/OR MASTERBULK PTE. LTD.,
Respondents.

DECISION

VELASCO JR., J.:

FACTS:

On June 1, 2011, petitioner Marcelino T. Tamin entered into a contract of employment 5 with respondent Magsaysay Maritime
Corporation (Magsaysay), for and in behalf of its principal, respondent Masterbulk Pte. Ltd. (Masterbulk), to work as Chief Cook on
board MV Star Heranger for a period of nine (9) months with a basic monthly salary of US$865.

As chief cook, petitioner was the overall in charge of the food catering department. His responsibilities included the supervision of
activities of the kitchen personnel, coordination with the ship's Master on food supplies and equipment, preparation of meat for
cooking, and inspection of the galley mess hall and equipment.
On November 16, 2011, while on kitchen duty and chopping pork knuckles for lunch, the chopping knife accidentally slid down and
cut petitioner's left forefinger at about 1.5 inches, causing it to detach from the joint bone. The Chief Officer and Second Officer
immediately applied paraffin gauze and prescribed antibiotics to petitioner to prevent infection. Petitioner was then brought to a
hospital in China on November 18, 2011 for removal of the damaged tissue and repair of his finger.

On November 27, 2011, petitioner was repatriated and referred to the company-designated physician, Dr. Benigno Agbayani, Jr.
(Dr. Agbayani), at the Manila Doctors Hospital. Dr. Agbayani found that there was a failed replantation of petitioner's injured finger;
thus, amputation was recommended. On November 30, 2011, petitioner underwent "tenolysis, amputation of left index finger" and
was discharged from the hospital on December 3, 2011. Thereafter, he was subjected to physical and occupational therapy
sessions. In a Final Out Patient Consult Report8 elated May 11, 2012, Dr. Agbayani assessed petitioner with a Grade 11 disability,
but declared him as "fit to return to work as seafarer."

Notwithstanding Dr. Agbayani's "fit to work" recommendation, petitioner continued to feel persistent pain on his left hand, rendering
him incapable to close it or carry even light objects with it. Thus, on June 22, 2012, he wrote a letter 9 to respondent Magsaysay
requesting further treatment.

Not receiving any response, petitioner wrote another letter10 on July 9, 2012 informing respondent Magsaysay of his intention to
seek a second opinion from another doctor to determine his true condition. Respondents, however, referred him back to Dr.
Agbayani, who saw petitioner on July 10, 2012 and noted a contracture of the 3rd, 4th, and 5th fingers on his left hand. Dr. Agbayani
then recommended another ten (10) sessions of physical therapy for petitioner.

Meanwhile, on July 31, 2012, petitioner went to another orthopedic surgeon, Dr. Manuel Fidel M. Magtira (Dr. Magtira), who found
him permanently disabled with a Grade 9 impediment. Dr. Magtira explained in detail his diagnostic conclusion that the left-handed
petitioner is unfit for further sea duties in any capacity.

With the above findings, petitioner demanded payment of his disability benefits, which demand respondents refused to heed.
Grievance proceedings were, thus, conducted during which petitioner turned down respondents' offer of US$35,000 as settlement.
Instead, petitioner requested for the amount of US$100,000 as full payment of his disability benefits under the CBA. 13 As a result,
the grievance proceedings proved unsuccessful and the parties brought the matter up for voluntary arbitration. The parties were
then instructed to submit their respective position papers.

VA June 11, 2014- rendered a Decision awarding full disability compensation to petitioner.

The focal point of the VA's Decision dealt with petitioner's capacity to go back to his former work as chief cook despite his disability.
In this regard, the VA ruled that disability is intimately related to one's earning capacity. Since the nature of a chief cook's job
requires the use of both hands and petitioner's injured hand cannot be moved without pain and limitation, the VA was convinced that
the disability has impaired petitioner's capacity to work as a chief cook on board a vessel. 18 Hence, so the VA held, petitioner's
disability is total. The VA also found that petitioner's disability has gone beyond 240 days and so concluded that it is permanent.

CA June 25, 2015 - resolved to grant respondents' petition for review.

The appellate court held that a claim for disability benefits should be based on the findings and declaration of the company-
designated physician who, in this case, declared a disability grading within the 240-day extension provided for by law.

ISSUE: Whether or not petitioner is entitled to permanent and total disability benefits.

RULING: YES

x x x [Petitioner postulates that the May 11, 2012 assessment of the company-designated physician cannot be deemed as final
since, on July 20, 2012, he still reported back to the company-designated physician who recommended that he undergo further
physical therapy due to the contracture of the other fingers of his left hand. As such, the POEA-SEC provision regarding the
appointment of a third doctor does not apply in his case since there is no assessment to contest as the company-designated
physician failed to come up with a final and definite assessment of his condition.

Respondents hinge their arguments on the CA's findings that the CBA involved does not have a permanent unfitness clause; that
the 240-day rule does not apply to the case since the company doctor timely assessed petitioner; and that no third doctor was
appointed so the opinion of the company doctor prevails.] xxx
Permanent disability is the inability of a worker to perform his or her job for more than 120 days, regardless of whether or not a
worker loses the use of any part of .his or her body.

Total disability, on the other hand, means the disablement of an employee to earn wages in the same kind of work or work of similar
nature that he or she was trained for, or accustomed to perform, or any kind of work which a person of his or her mentality and
attainments could do.

In the case at bar, it has to be noted that the company-designated physician did not issue a final medical assessment on petitioner's
disability rating within 120 days from petitioner's repatriation. Petitioner was repatriated on November 27, 2011. On November 30,
2011, he underwent "tenolysis, amputation of left index finger" and was discharged from the hospital on December 3, 2011.
Thereafter, he was subjected to physical and occupational therapy sessions. Petitioner was certainly still disabled to return to work
as a cook on board an ocean-going vessel.

Since petitioner required further therapy sessions beyond the 120-day period, his total and temporary disability extended. The
company-designated physician then had until 240 days from repatriation to give the final assessment.

On May 11, 2012, or after a period of 166 days, the company-designated physician issued a report assessing petitioner with a
Grade 11 disability and declaring him as "fit to return to work as seafarer." However, despite the company-designated physician's "fit
to work" declaration, petitioner still felt persistent pain in his left hand, rendering him incapable to close it or carry even light objects
with it. As a consequence, he was again referred by the respondents to Dr. Agbayani who saw petitioner on July 10, 2012.

On July 10, 2012, or after a period of 226 days from petitioner's repatriation, Dr. Agbayani found a contracture of the 3 rd, 4th, and 5th
fingers on petitioner's left hand.31 At this point, Dr. Agbayani is nearing the end of the extended period of 240 days within which to
give petitioner's final disability assessment, yet he gave none. Instead, Dr. Agbayani recommended for petitioner to undergo another
ten (10) sessions of physical therapy.

In effect, Dr. Agbayani's subsequent findings and recommendation on July 10, 2012 abandoned his May 11, 2012 disability
assessment and caused the 240-day extended period to expire without a final and definite assessment of petitioner's disability.

Jurisprudence is replete with cases where the Court struck down a company-designated physician's disability assessment for being
belatedly issued, insufficient, or due to lack of finality.

Indubitably, the timely and definite declaration by the company-designated physician is an obligation, the abdication of which
transforms the temporary total disability to permanent total disability, regardless of the disability grade.

In the instant case, the company-designated physician failed to give a definitive impediment rating on petitioner's disability beyond
the extended temporary disability period of over 120 but not more than 240 days. The May 11, 2012 disability assessment issued by
the company-designated physician was merely interim because petitioner still experienced recurring pain in his left hand and was
required to undergo further therapy sessions even after May 11, 2012.

It also bears stressing that when petitioner sought for a grievance conference on July 27, 2012, the period of 240 days had already
lapsed on July 24, 2012 without a final and definite disability assessment from the company-designated physician. At that point, the
law steps in to consider petitioner's disability as permanent and total. 35 By operation of law, petitioner's total and temporary disability
lapsed into a total and permanent disability.36 Clearly then, the third-doctor-referral provision as provided in the POEA-SEC37 does
not find application in the case at bar. Petitioner's cause of action arose when his disability went beyond the 240-day period without
a final assessment having been issued by the company-designated physician.

Furthermore, beyond the 240-day period, petitioner was still incapacitated to perform his usual sea duties as he was still feeling
persistent pain in his injured hand and was advised to undergo further therapy sessions. Verily, in spite of the lapse of the extended
240-day period, petitioner was still incapacitated to perform his sea duties. Due to the injury he sustained, he could no longer
perform his usual tasks as chief cook in any vessel. Thus, it resulted in his unemployment until this very day. As correctly held by
the VA, this clearly indicates petitioner's total and permanent disability.

it is not only the contract between the parties that governs the determination of the disability compensation due the seafarer. 41 The
Court has ruled that to determine whether a seafarer is entitled to permanent and total disability benefits, both the law and contract
which govern his or her overseas employment should be taken into account.42 As discussed above, the pertinent laws are the
provisions on disability of the Labor Code,43 in relation with Rule X, Section 2 of the AREC,44 which implemented Book IV of the
Labor Code. By contract, the POEA-SEC, as provided under Department Order No. 4, Series of 2000, of the Department of Labor
and Employment, and the parties' CBA bind the seafarer and his or her employer to each other.

Thus, while it has been established that the CBA is the contractual consideration in determining the rights of a seafarer to disability
benefits, it cannot be read and interpreted in isolation of the foregoing statutory provisions, implementing rules, and prevailing
jurisprudence. In determining the disability compensation due to a seafarer, the Court does not only consider the physical injury
sustained, but the effect of such injury to the seafarer's capacity to perform the usual tasks that he was trained for or accustomed to
perform.

Records show that the petitioner did not get a new overseas assignment after his disability. This only shows that his disability
effectively barred his chances to be deployed abroad as a chief cook of an ocean-going vessel. Therefore, it is fitting that petitioner
be entitled to total and permanent disability benefits considering that he would not be able to resume his previous occupation and
the probability that he would be hired by other maritime employers would be close to impossible.

30. G.R. No. 206600, December 07, 2016

ALMA COVITA, FOR HER BEHALF AND IN BEHALF OF HER TWO MINOR CHILDREN, JERRY AND RON, BOTH SURNAMED
COVITA, Petitioner, v. SSM MARITIME SERVICES, INC. AND/OR MARITIME FLEET SERVICES PTE. LTD. AND/OR GLADIOLA
JALOTJOT, Respondents.

DECISION

PERALTA, J.:

FACTS:

On April 29, 2009, Rolando Covita, petitioner's husband, entered into a contract of employment with private respondent SSM
Maritime Services, Inc., acting for and in behalf of its foreign principal, private respondent Maritime Fleet Services Pte. Ltd. to work
on board M/T Salviceroy as Bosun for a period of eight (8) months with a basic monthly salary of US$635.00.

As a condition for employment, Rolando underwent a standard Pre-employment Medical Examination (PEME) where he was
declared fit for sea duty, and boarded his vessel of assignment on May 7, 2009.

However, on May 14, 2009, Rolando developed weakness of both lower extremities and was vomiting; thus, he was confined at the
Singapore General Hospital up to May 21, 2009, where he was diagnosed to be suffering from end stage renal failure.

On May 23, 2009, he was medically repatriated to the Philippines. He was admitted at the Manila Doctor's Hospital where he was
diagnosed by Dr. Nicomedes G. Cruz, the company--designated physician, with chronic renal failure.6 Later, Dr. Cruz issued a
Certification7dated May 28, 2009 that Rolando's chronic renal failure was not work-related.
Rolando died on September 20, 2009.

Petitioner Alma Covita, Rolando's surviving spouse, for herself and on behalf of her two minor children, Jerry and Ron, filed with the
Labor Arbiter (LA) a Complaint for death benefits, allowance for two minor children, burial allowance, moral and exemplary
damages, legal interest and attorney's fees.

LA found that while Rolando died after the term of his contract, such will not militate against petitioner's claim for death benefits as
the underlying cause of Rolando's death was the illness that manifested during the effectivity of their contract; thus, the requirement
that the death or cause thereof must have occurred during the term of the contract had been met. As to work
connection/aggravation, the LA ruled that respondents did not offer proof to dispute the allegation that prior to his last contract that
caused his medical repatriation, Rolando had been contracted for the same position and rendered shipboard services for the
respondents and that every time he was contracted, his PEME showed that he was fit for sea duty; and that petitioner had
adequately proven that Rolando's working conditions on board the vessel contributed, if not caused, his subsequent illness.

NLRC agreed with the findings of the company-designated physician that Rolando's illness which led to his demise was not work--
related. It found that Rolando joined M/T Salviceroy on May 7, 2009 and from May 14-21, 2009, he was confined at the Singapore
General Hospital where he was diagnosed with end stage renal failure which could not have developed over a one week period;
hence, not work-related; that his PEME showed him fit to work was not a conclusive proof that he was free from any ailment prior to
his deployment.

CA affirmed the NLRC as there was no substantial evidence to prove that the illness which caused Rolando's death was contracted
during the term of his contract with respondents or was work--related.

x x x [Petitioner contends that the CA erred in failing to award her death benefits on the ground that Rolando's illness was not work-
related and was not contracted during the term of his employment; that the CA disregarded Section 20B(4) of the Standard
Employment Contract, which provides that illnesses not listed as occupational diseases are disputably presumed as work-related and
the burden to show the work connection is with the respondents; that Rolando stayed only for one week in respondents' vessel is of
no moment as he was able to finish his other contract with respondents prior to his last contract and if the renal cancer was developed
prior to his last contract, although unknown to Rolando, his services with the same respondents may have caused or aggravated his
illness.] x x x

ISSUE: Whether the petitioner is entitled of death benefits.

RULING: NO

Section 20(A) of the 2000 POEA Standard Employment Contract states the rules in granting death benefits to the seafarer's
beneficiaries as follows:

1. In the case of work-related death of the seafarer during the tern of his contract, the employer shall pay his beneficiaries the Philippine
Currency equivalent to the amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars
(US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange rate prevailing during
the time of payment.

xxxx

4. The other liabilities of the employer when the seafarer dies as a result of work-related injury or illness during the term of employment
are as follows:

xxxx

c. The employer shall pay the beneficiaries of the seafarer the Philippine currency equivalent to the amount of One Thousand US
dollars (US$1,000) for burial expenses at the exchange rate prevailing during the time of payment.

Clearly, to be entitled for death compensation and benefits from the employer, the death of the seafarer (1) must be work-related; and
(2) must happen during the term of the employment contract. While the 2000 POEA- SEC does not expressly define what a "work-
related death" means, it is palpable from Part A (4) as above-cited that the said term refers to the seafarer's death resulting from a
work-related injury or illness.
A work-related illness is defined under the POEA Standard Employment Contract as any sickness resulting to disability or death as a
result of an occupational disease listed under Section 32-A of this contract with the conditions set therein satisfied, to wit: (1) The
seafarer1s work must involve the risks described herein; (2) The disease was contracted as a result of the seafarer's exposure to the
described risks; (3) The disease was contracted within a period of exposure and under such other factors necessary to contract it;
and (4) There was no notorious negligence on the part of the seafarer. It is also provided under Section 20B(4) of the same contract
that illnesses not listed in Section 32-A are disputably presumed work-related. However, Section 20 should be read together with the
conditions specified by Section 32-A for an illness to be compensable.

Accordingly, petitioner cannot just contend that while her husband 1 s chronic renal failure is not listed as an occupational disease, it
is disputably presumed work-related, and it is for respondents to overcome such presumption. Petitioner still has to prove her claim
for death compensation with substantial evidence or such amount of relevant evidence which a reasonable mind might accept as
adequate to justify a conclusion.

It bears stressing that Rolando was only on board the vessel for seven days when he was diagnosed with chronic renal failure
which, as above-quoted, is a progressive deterioration of the kidney function which happens over a period of time, therefore, it
cannot be absolutely declared that he developed such illness during that short period in respondents' vessel.

Rolando was medically repatriated on May 23, 2009 and died on September 20, 2009. It is provided under Section 18B(1) of the
POEA Standard Employment Contract that the employment of the seafarer is terminated when he arrives at the point of hire and
signs off and is disembarked for medical reasons. Hence, when Rolando was medically repatriated on May 23, 2009, his contract of
employment with respondents was effectively terminated. Considering that Rolando’s death did not occur during the term of his
employment contract and not work-related, his death is not compensable.

xxx Petitioner claims that the fact that Rolando stayed only in respondents' vessel for one week with his last contract is of no
moment as he was able to finish his eight-month contract with respondents prior to his last contract; that there is a big possibility that
he had contracted such illness in his previous assignment with the respondents.

We are not impressed.

Rolando's employment as a seafarer is governed by the contract he signs every time he is rehired and his employment is terminated
when his contract expires.34 Therefore, his contract with respondents was considered automatically terminated after the expiration of
each overseas employment contract.35 If Rolando was already suffering from chronic renal failure when he began his last contract
with respondents, his illness during his previous contract with respondents is deemed pre-existing during his subsequent contract.36
Hence, his death arising from a pre-existing illness is not compensable37 as he did not acquire it during the term of his last
employment contract with respondents

The PEME is nothing more than a summary examination of the seafarer's physiological condition. 40The "fit to work" declaration in
the PEME cannot be a conclusive proof to show that one is free from any ailment prior to his deployment. 41 As discussed in
Masangcay v. Trans Global Maritime Agency Inc.,42 the decrease of GFR, which is an indicator of chronic renal failure, is measured
thru the renal function test,43 and in pre-employment examination, the urine analysis (urinalysis), which is normally included,
measures only the creatinine, the presence of which cannot conclusively indicate chronic renal failure.
#32 G.R. No. 224532 June 21, 2017
CONSTANCIO CADERAO BALATERO, Petitioner vs. SENATOR CREWING (MANILA) INC., AQUANAUT
SHIPMANAGEMENT LTD., ROSE AARON and CARLOS BONOAN, MV MSC FLAMINIA, Respondents

Two consolidated petitions for review on certiorari.

1st- petitioner against respondents

2nd – respondents against petitioner
Both petitions assail the Court of Appeals' (CA) Decision and Resolution which reversed the rulings of the Labor
Arbiter (LA) and the National Labor Relations Commission (NLRC) awarding to Balatero the amount of US$60,000.00
as permanent total disability benefits, plus 10% attorney's fees.
FACTS:
· April 12, 1997 - Balatero was initially engaged by the respondents as an able-bodied seaman. He worked
his way up to become 2nd Officer and had boarded 18 of the respondents' ships.
· July 31, 2013 - Balatero boarded MV MSC Flaminia for a six-month contract as 3rd Officer;

- found as ''fit to work' upon compliance with the required Pre-Employment Medical Examination
(PEME)
- basic monthly salary of US$1,120.00, plus overtime pay and subsistence allowance.
· December 22, 2013 - Balatero experienced chest pains, with palpitations and shortness of breath.

- Taken to Odense University Hospital (Odense) in Denmark, diagnosedto have an elevated blood
pressure, prescribed anti-hypertensive medicines, and discharged thereafter.
· January 2, 2014 - Balatero suffered similar symptoms; advised to continue with the earlier prescribed
anti-hypertensive medicines, and be repatriated for further medical evaluation.
· January 5, 2014 – Balatero arrived in Manila

- the day after he reported for post-medical examination and was referred to the care of the company
designated physician, Dr. Olalia
 - in a Medical Report dated January 8, 2014, Dr. Olalia found Balatero to be suffering from
"Uncontrolled Hypertension; Unstable Angina; To Consider Coronary Artery Disease [CAD];
Dyslipidemia," the etiologies of which were multi-factorial but not work-related.

- Balatero underwent Coronary Angiogram and Aortogram, which revealed that he had "Severe [CAD]
ofthe [Left Anterior Descending], D2 and [RightPosterior Descending Artery]; and Moderate [CAD] LCx."
· February 17, 2014 - Balatero underwent Percutaneous Transluminal Coronary Angioplasty(2 stents of
the Mid Left Anterior Descending and Ostio Proximal Right Posterior Descending Artery).
- Balatero was prescribed five maintenance medicines
- The medical expenses were shouldered by the respondents, and Balatero was also paid his
sickness allowance. He was subsequently declared fit to work, but with medical maintenance for the
rest of his life.
· Unconvinced about his fitness to resume sea duties, Balatero consulted a Dr. Lara-Orencia), an
occupational doctor.
- in the Medical Certificate dated June 3, 2014, Dr. Lara-Orencia found Balatero to be suffering
from "HypertensiveCardiovascular Disease," which was ''precipitated by the stressful nature of his
work."

- Under Item No. 1 l(c) of the POEA-SEC for Seafarers, CAD is a compensable illness.
- Under Item No. 13, Uncontrolled Hypertension, arising from exposure to extreme physical and
psychological stress at work, is an occupational illness.
- Dr. Lara-Orencia concluded that Balatero cannot return to his employment as 3rd Officer due
to the latter's on and off chest pains, "easy fatigability" and continuous intake of five maintenance
medicines("ASA 80 mg., Clopidogrel 75 mg.,Candesartan+Amlodipine, Carvediloz and Rosuvastatin
20 mg.")

· Balatero demanded permanent total disability benefits

- Respondents denied Balatero on the ground that after treatment and rehabilitation, the company-
designated doctor had assessed Balatero with a disability of Grade 7 (Moderate Residuals of
Disorders) under the POEA SEC.

· Balatero filed before the NLRC a complaint for permanent total disability compensation, sickness
allowance, damages and attorney's fees.
- His sea duties as 2nd and 3rd Officer were strenuous, and had exposed him to unhealthy
working conditions, extreme temperatures and contaminants, which either directly caused his
illnesses or contributed thereto.
- The respondents, however, denied the work-relatedness and compensability of Balatero's
illnesses. Dr. Olalia's Medical Report indicated that Balatero’s Dyslipidemia is caused by defects in
lipid metabolism and/or high fat diet, hence, not work-related. Further, CAD arises from the gradual
deposits of fats, fibrin and clots in the coronary artery spanning years. Diabetes Mellitus, age, sex,
hypertension, smoking and elevated cholesterol levels, out of which CAD may develop, are not work-
related as well.
· Ruling of the LA – in favor of Balatero

- The Labor Arbiter finds Baltero to be entitled to total and permanent disability benefits and
orders respondents to pay him the amount US$60,000.00 representing his total and permanent
disability benefits under the POEA Contract and attorney's fees of 10% of the said amount.

- The LA, however, denied Balatero's claim for moral and exemplary damages, as there was
inadequate evidence of bad faith on the part of the respondents.
 - In Wallem Maritime Services, Inc., et al. v. NLRC, et al., the LA declared that the assessments
of both the company-designated physicians and those consulted by the seafarers on their own accord
are not conclusive, thus, need evaluation on their inherent merits. Moreover, assuming arguendo
that Balatero was already afflicted with cardiovascular diseaseprior to his employment with the
respondents, his exposure to stressful working conditions and a diet of unhealthy, fatty and salty
foods while on board the ship had likely triggered, contributed to the development of, or aggravated
his condition.
- The LA also noted the respondents' inconsistent stances in initially declaring that Balatero's
illnesses were not work-related, and eventually determining that he had a Disability Grade of 7 under
the POEA SEC.
· Ruling of the NLRC – affirms the decision of the LA

- considered Balatero's length of service rendered aboard 18 of the respondents' ships, and the
stressful and unhealthy conditions thereat, which contributed to or aggravated the development of
Balatero's Hypertensive Cardiovascular Disease.

- There was no assurance given by the company-designated physicians that Balatero would be
able to fully recover from his condition and perform his work like he did before.
- denied respondents' motion for reconsideration.
· Ruling of the CA – assailed decision

- pending the resolution of their petition for certiorari filed before the CA, the respondents
conditionally paid Balatero the amount of US$66,000.00, with the provision that in case of a reversal
of the NLRC's judgment by the CA or this Court, the sum shall be returned.
- CA rendered the herein assailed Decision, where it sets aside the decisions of the Labor Arbiter
and the NLRC
- Ordered SCMI and Aquanaut to jointly and severally pay [Balatero] the sum of US$20,900.00,
or its equivalent amount in Philippine currency at the time of payment corresponding to Grade 7
Disability Rating benefits
- [I]t is jurisprudentially settled that cardiovascular disease, [CAD], and other heart ailments are
work-related.
- In Magsaysay Mitsui OskMarine,Inc., et al. vs. Juanita G. Bengson, the High Court enunciated
that the cardiovascular illnesses of therein complainant, who has been serving for the petitioners as
Third Mate for twelve (12) years, were work-related. Since the complainant’s contract were
continuously renewed, it can be said that he had spent much of his productive years with petitioners,
his years of service certainly took a toll on his body, and he could not have contracted his illness
elsewhere except while working for petitioners. Given that, and coupled with the evidence on record
showing how [Balatero's] working conditions caused or aggravated his illnesses, We uphold the
finding of the lower tribunals that [Balatero's] illnesses were work-related and/or work-aggravated.
- CA holds that his claim for permanent disability benefits must fail.

· One of the assigned errors raised by the [respondents] was that assuming that [Balatero's] illnesses were
work-related, only the amount of US$20,900.00 corresponding to Disability Grading of 7 - Moderate residuals
o[j] disorder - was due the latter and nothing more.

- On the other hand, [Balatero] claimed that he consulted a second doctor because the company-
designated physician declared him fit to work after his angioplasty and after being required to take
maintenance medications.
- [T]he pivotal question now that We think should be confronted is which findings should prevail:
the findings of the company-designated physician or the assessment by [Balatero' s] personal
physician that he was unfit for sea duties, hence, permanently disabled? A related question
immediately follows - how are the conflicting assessments to be resolved?
 - In Section 20 (A) (3) of the 2010 POEA-SEC provides that if a doctor appointed by the seafarer
disagrees with the assessment of the company-designated doctor, a third doctor may be agreed
jointly between the employer and the seafarer, and the third doctor's decision shall be final and
binding on both parties. Consequently, this referral to a third doctor has been held by the High Court
to be a mandatory procedure as a consequence of the provision that it is the company-designated
whose doctor assessment should prevail.
· The assessment made by [Balatero's] physician-of-choice was only issued after a one-time medical
treatment was bare of essential facts as to how the medical conclusions were arrived at.
- Also, after being examined once no series of tests and treatments were likewise conducted to
support the diagnosis of the latter's condition.
- The CA cannot give credence to such assessment for being questionable and suspicious.
· Accordingly, [Balatero] is entitled to receive disability benefits corresponding to the Grade 7 disability
rating in view also of the fact that [the respondents] had manifested their willingness to pay [Balatero] the
disability compensation in the amount of US$20,900.00 corresponding to such grade.

- The amount shall be paid jointly and severally by [SCMI] and [Aquanaut] but with the exception
of [Aaron] and [Bonoan,] who are hereby ordered excluded as parties solidarily liable to pay the
amount due [to Balatero.]
- [SCMI] has a personality separate and distinct from that of its officers, thus, [Aaron] and [Bonoan]
cannot be held solidarily liable for the amount due.
· Under Article 2208 of the Civil Code, attorney's fees can be recovered when the defendant's act or
omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest.
- an award of attorney's fees is the exception rather than the rule, hence, it is necessary for the
lower tribunal to make findings of fact and law which bring the case within the exception and justify
the grant of the award. Here, We find that none of the exceptions applies.(Citations omitted)
· CA denied the respective MRs separately filed by Balatero and the respondents.
ISSUES

· 1st petition
- Whether or not the CA erred in holding that:
(1) he only suffers from Grade 7 Disability, hence, only entitled to benefits corresponding thereto;
(2) no attorney's fees and moral and exemplary damages should be awarded to him;
(3) Aaron and Bonoan cannot be held solidarily liable with SCMI and Aquanaut in the payment of the monetary
awards; and
(4) there is no merit in his MR, which did not raise new issues.
· 2nd petition
- Whether or not Balatero is entitled to partial disability compensation when his illnesses are not
work-related.

BALATERO RESPONDENTS
· ART. 192 of the Labor Code explicitly · The POEA SEC does not state that a
provides that temporary total disability shall disability grading issued by a company-
be deemed permanent and total if it lasts designated doctor automatically entitles a
continuously for more than 120 days (Crystal seafarer to disability benefits.
Shipping, Inc. v. Natividad; Carcedo v. Maine
- A disability grading
Marine Philippines, Inc.)
assessment is a form of
- under the Medical Standards evaluation, but it does not
in the Conduct of PEME for determine the work-relation of an
Seafarers, his cardiovascular illness. The said assessment can
conditions, requiring him to take be made even if the illness is not
more than two maintenance work-related.
medicines, render him unfit for
· Dr. Olalia categorically found Balatero's
service.
illnesses to be multi-factorial in origin, with
· In case of variance between the genetic predisposition, unhealthy lifestyle,
assessments of the company-designated salty diet, smoking, Diabetes Mellitus, age
doctor and the seafarer's physician of choice, and increased sympathetic activity as
referral to a third doctor is merely optional possible risk contributors. However,
and directory, not mandatory Balatero failed to adequately prove that the
foregoing were attendant in, or arose out of,
· Balatero challenges as well the CA's
his shipboard employment.
declaration that Dr. Lara-Orencia's findings
cannot be given credence.
- his chosen doctor cannot be
expected to replicate all the
procedures, tests and examinations
already conducted as to do
otherwise would have been
impractical. It was sufficient that Dr.
Lara-Orencia interpreted the results
of medical tests and procedures,
and formulated her assessment
therefrom.
· He is entitled to his claims for moral and
exemplary damages, and attorney's fees
- the respondents' unjust denial
of his disability benefits was
attended by bad faith, and had
compelled him to engage legal
services to protect his rights. As
Balatero had suffered moral
anguish, severe anxiety and
wounded feelings by reason
thereof, the respondents' acts and
omissions deserve correction.
· Under Section 10 of Republic Act No.
8042, or the Migrant Workers and Overseas
Filipinos Act of 1995, Aaron and Bonoan as
corporate officers of SCMI, should be held
solidarily responsible for the money claims.
 - In bad faith, they assented to
the unlawful acts, or were grossly
negligent in preventing the
commission thereof.
· Balatero points out that reiterations in
the MR of the issues passed upon by the
court does not render a motion proforma.
(Coquilla v. Commission on Elections )To
hold otherwise would mean that the movant
should instead resort to new trial or other
remedies.
RULING OF THE COURT

· The Court partially grants Balatero 's petition, and denies that of the respondents.

· Balatero's entitlement to permanent total disability compensation and attorney's fees

- Is Balatero's entitlement permanent total disability compensation as recommended by his
chosen physician, Dr. Lara-Orencia, or merely to that corresponding to Grade 7 Disability rating as
assessed by the company-designated doctor.

The company-designated doctor assessed Balatero
to be suffering from Grade 7 Disability under Section
32 of the POEA SEC, to wit, "Moderate residuals of
disorder of the intra-abdominal organs secondary to
trauma resulting to impairment of nutrition, moderate
tenderness, nausea, vomiting, constipation or
diarrhea."
Dr. Lara-Orencia found Balatero's Hypertensive
Cardiovascular Disease as an occupational disease
under Section 32(A), Items 1 l(c)58 and 13(bf9 of the
POEA SEC. Due to Balatero's recurrent chest pains,
"easy fatigability," and continuous intake of five
maintenance medicines, he was no longer fit to
resume sea duties as 3rd Officer.

- The Court found, after examining the pleadings filed by the respondents and notes that nowhere
did they categorically state the date when the company-designated doctor had issued Balatero's final
disability rating. They also did not attach or completely quote the medical report of the company-
designated doctor.
· Reviewing the facts, it can be concluded that as of June 3, 2014, which was more than 120 days
from Balatero' s repatriation, no final disability rating was yet issued by the respondents, sans proof
too that the latter sought for an extension to further determine the seafarer's fitness to work.

- Dr. Olalia's Medical Report negating the work-relatedness of the Balatero’s medical condition
was made in interim and cannot be considered as the final disability rating issued by the company-
designated doctor.
- The Court ruled in the case of Carcedo that: A partial and permanent disability could, by legal
contemplation, become total and permanent. The Court in Kestrel Shipping Co., Inc. v. Munar held
that the declaration by the company-designated physician is an obligation, the abdication of which
transforms the temporary total disability to permanent total disability, regardless of the disability
grade, viz:

- Under Section 32 of the POEA-SEC, only those injuries or disabilities that are classified as
Grade 1 may be considered as total and permanent. However, if those injuries or disabilities with a
disability grading from 2 to 14, hence, partial and permanent, would incapacitate a seafarer from
performing his usual sea duties for a period of more than 120 or 240 days, depending on the need
for further medical treatment, then he is, under legal contemplation, totally and permanently disabled.
- An impediment should be characterized as partial and permanent not only under the Schedule
of Disabilities found in Section 32 of the POEA-SEC but should be so under the relevant provisions
of the Labor Code and the Amended Rules on Employee Compensation (AREC) implementing Title
II, Book IV of the Labor Code.

- That while the seafarer is partially injured or disabled, he is not precluded from earning [or]
doing the same work he had before his injury or disability or that he is accustomed or trained to do.
- The company-designated physician is expected to arrive at a definite assessment of the
seafarer's fitness to work or permanent disability within the period of 120 or 240 days and if he fails
to do so and the seafarer's medical condition remains unresolved, the seafarer shall be deemed
totally and permanently disabled.
 - Since the company-designated doctor had made a final Grade 7 Disability Rating beyond 120
days from repatriation, his partial disability is deemed permanent. As a result thereof, the issue of
non-referral to a third doctor is rendered inconsequential.
· In Dalusong, the Court instructed that in case no third doctor is appointed by the parties, the labor tribunal
and the courts shall assess the inherent merits of the divergent findings of the company-designated doctor
and the seafarer's chosen physician.
- Dr. Lara-Orencia had considered the tests and procedures done on Balatero, his health status
then, his recurrent chest pains, easy fatigability and intake of a total of five maintenance medicines.
Dr. Lara-Orencia related Balatero's conditions to the POEA SEC, which listed CAD and Uncontrolled
Hypertension as occupational diseases, and the physical and psychological stress, to which a
seafarer is exposed which led to the conclusion that Balatero cannot return to his job as 3rd Officer.
- The respondents, in their pleadings filed with the Court, did not explain why the Grade 7 Disability
Rating they issued should prevail. The respondents relied on the supposed conclusive character of
the findings of the company-designated physicians, without explaining in substance how they were
arrived at.
- Balatero falls within the category provided in DOH A.O. No. 2007-0025 which recommends the
non-issuance of fit-to-work certifications to seafarers "with acute or chronic cardiovascular condition
limiting physical activity, requiring more than two (2) maintenance oral medicines and close
monitoring, or causing significant disability," specifically those(1)suffering from CAD,(2)has
undergone Coronary Angioplasty within six months, with history of Uncontrolled Diabetes Mellitus,
Hypertension and Dyslipidemia, and (3) Hypertension requiring three or more drugs, among others..
- Jurisprudence is replete with doctrines granting permanent total disability compensation to
seafarers, who suffered from either cardiovascular diseases or hypertension, and were under the
treatment of or issued fit-to-work certifications by company-designated doctors beyond 120 or 240
days from their repatriation.

· The Court is compelled to reinstate the LA and NLRC' s ruling granting Balatero permanent total disability
compensation, and set aside the CA's disquisition that only benefits pertaining to Grade 7 Disability Rating
should be awarded on the basis of the following: (1) Dr. Lara-Orencia's ample explanation on how she had
arrived at a permanent total disability assessment; (2) the recommendations of DOH A.O. No. 2007-0025 on
the issuance of fit-to-work certificates; and (3) jurisprudence granting permanent total disability compensation
to seafarers suffering from hypertensive cardiovascular diseases, who were either under the treatment of, or
issued fit-to-work certifications by company-designated doctors beyond 120 or 240 days from their
repatriation.
· Balatero is not entitled to moral and exemplary damages since the respondents' acts did not evince bad
faith. Balatero was paid his sickness allowance and his medical expenses were likewise shouldered by the
respondents.
· As for Balatero's claim for attorney's, since Balatero had been compelled to litigate due to the respondents'
denial of his valid claims, the Court accordingly reinstates the award.
· On the ground of mootness, the Court perceives no necessity to address the rest of the issues raised by
Balatero.
· WHEREFORE, the petition is PARTIALLY GRANTED
· The Court SETS ASIDE the Decision and Resolution of the Court of Appeals ordering Senator Crewing
(Manila), Inc. and Aquanaut Shipmanagement Ltd. to solidarily pay Constancio Caderao Balatero the sum of
US$20,900.00 as compensation corresponding to Grade 7 Disability Rating.
· The Court REINSTATES the Decision of the Labor Arbiter, which was affirmed by the National Labor Relations
Commission, awarding Constancio Caderao Balatero permanent total disability compensation of US$60,000.00, plus
ten percent (10%) attorney's fees. In view of the payment of the amount of P3,019,368.00, then the equivalent of the
total award of US$66,000.00, tendered to Constancio Caderao Balatero on September 29, 2015, interest shall no
longer be imposed, and this judgment is already deemed SATISFIED.

# 33 G.R. No. 200576 November 20, 2017

MAERSK-FILIPINAS CREWING, INC. and AP MOLLER SINGAPORE PTE LTD., Petitioners vs. ROSEMARY G.
MALICSE (Legal wife of the deceased seafarer Efren B. Malicse, representing the latter's estate), Respondent
This is a Petition for Review on Certiorari, seeking a reversal of the Court of Appeals (CA) Decision and
Resolution, awarding death benefits, moral and exemplary damages, and attorney's fees to respondent
Rosemary G. Malicse as the beneficiary of the deceased seafarer, Efren B. Malicse.
FACTS:
• Efren, for the 10th time, was employed as an able-bodied seaman by petitioner AP Moller Singapore
Pte., Ltd. for a term of nine months through its agency, Maersk-Filipinas Crewing, Inc.
- already passed his pre-employment medical examination and was declared fit to work.
• May 20, 2007 - Efren complained of a fever and headache while on board Maersk Tide.
- paracetamol, bed rest, and tetracycline administered by the vessel's medical staff did not work
- sent to Clinica Hospital del Atlantico in Panama on 25 May 2007.
• He died on May 29, 2007
- His death certificate stated that he died of "multiple organ dysfunction, Septicemia and
Mononucleosis due to Cytomegalovirus." According to the Autopsy Report and the Pathological Report of
Dr. Edwin C. Alconel, an anatomical and clinical pathologist of the City Health Office of General Santos City,
Efren died of "multiple organ failure secondary to septicemia." Neither party disclaimed that Efren died of
septicemia, which is severe blood poisoning or infection.
• Petitioners paid Rosemary USD 1,000 representing burial benefits.
- As for death benefits, they offered her USD 40,000, which was equivalent to half of the death benefits
provided by the Collective Bargaining Agreement (CBA) between Maersk and Singapore Organization of
Seamen, the union to which her husband belonged.
- She was refused a copy of the CBA by pettioners, as well as a copy of the International Transport
Workers Federation Standard Collective Agreement (ITF Agreement)
• Rosemary filed a Complaint before the Executive Labor Arbiter (LA) for death benefits, moral and
exemplary damages, and attorney's fees.
- Petitioners responded that the death of her husband was not caused by a work-related illness.
- Rosemary countered by arguing that according to the ITF Agreement, she was entitled to death
benefits regardless of the cause of Efren's death.
• The LA sustained the claim of Rosemary that the labor union of her husband was an affiliate of the
ITF.
- The LA held that the ITF Agreement should prevail over the CBA and the POEA-SEC.
- The ITF Agreement had a more beneficial provision on granting death benefits since it awards
claims regardless of the seafarer's cause of death.
• LA granted death benefits of USD 82,500 to Rosemary and ordered petitioners to pay her moral
damages of PHP 5 million, exemplary damages of PHP 3 million, and 10% attorney's fees.
• Petitioners appealed before the National Labor Relations Commission (NLRC).
- Rosemary likewise appealed and demanded payment for loss of income and interest on her
monetary claims.
- The NLRC dismissed the appeals. Both parties moved for reconsideration, but to no avail.
• The NLRC held that the LA correctly appreciated the applicability of the ITF Agreement.
- the NLRC declared that petitioners had the burden of proving that Efren had died of a non-
compensable illness. Finding that petitioners had failed to discharge such burden, the
- NLRC affirmed the ruling of the LA with the modification that moral and exemplary damages be
reduced to ₱l00,000 and ₱50,000, respectively.
• Petitioners and respondent separately filed Petitions for Certiorari before the CA, with essentially the
same arguments as those raised a quo.
• The CA found no grave abuse of discretion on the part of the NLRC. In its assailed Decision dated 21
October 2011,
- the CA maintained that petitioners were liable to Rosemary for full death benefits and damages, but
that she was not entitled to additional compensation in the form of income losses and interest claims.
- Maersk-Filipinas Crewing, Inc., and its foreign principal A.P. Moller Singapore PTE. LTD., are jointly
and solidarily liable in the payment of eighty thousand US Dollars (USD 80,000.00) as indemnity pursuant to
the ITF Standard Collective Agreement. Moral and exemplary damages are hereby awarded to Rosemary G.
Malicse in the amounts of ₱100,000.00 and ₱50,000.00, respectively, or a total of ₱150,000.00. Ten percent
(10%) of the total monetary award is further awarded to Rosemary G. Malicse as attorney's fees.
- echoed the appreciation of the NLRC that employers have the burden of proof in showing that the
seafarer died from a non-compensable illness. The appellate court ruled that petitioners had failed to show
that they were not liable to pay respondent's claims for death benefits.
• Petitioners have therefore filed the instant Petition for Review on Certiorari, questioning the grant of
death benefits and damages, as well as the applicability of the ITF Agreement.
- Respondent has waived her right to comment on this petition.
ISSUE:
Whether or not respondent is entitled to death benefits.
RULING OF THE COURT
The Applicability of the PO EA-SEC, the CBA, and the ITF Agreement
• The entitlement to disability benefits of seafarers on overseas work is a matter governed not only by
medical findings, but also by law and contract. By contract, the POEA-SEC and the CBA bind seafarers and
their employers. An overriding instrument, such as the instant ITF Agreement, also forms part of the
covenants of the parties to each other.
• In awarding death benefits to Rosemary in the amount of USD 82,500, the LA, the NLRC, and the CA
cited Section 19 of the ITF Agreement, viz:
- If a Seafarer dies through any cause, whilst in the employment of the Company, or arising from
her/his employment with the Company, including death from natural causes or death occurring whilst
travelling to or from the vessel, or as a result of marine or other similar peril, the Company shall pay the
sums specified in the attached schedule [US$82,500 in Annex 2] to the widow or children or parents and to
each dependent child up to a maximum of 4 (four) under the age of 21. x xx.
- However, before claimants may avail themselves of the benefits provided by Section 19 of the ITF
Agreement, they must comply with the condition set in for the applicability of the Agreement: (1) the seafarer
is a member of a union, (2) which is affiliated with the ITF, (3) that has entered into a special agreement with
petitioners.
- The parties have not disputed the first requisite. However, the labor tribunals made a generalization
without citing their sources. They failed to point to specific evidence showing that Efren's labor union was
affiliated with the ITF. Neither did the LA, the NLRC, or the CA allude to a special agreement between the
union or the ITF and petitioners.
- Therefore, this Court will not automatically conclude that the seafarer is entitled to the benefits given
under the ITF Agreement premised on the unreferenced determination of the labor tribunals.
- None of the pieces of evidence adduced by the parties has depicted with clarity the relationship of
Efren's labor union - Singapore Organisation of Seamen - with the ITF. Furthermore, none of the documents
herein portray that petitioners entered into any special agreement.
- In this light, we find grave abuse of discretion on the part of the CA for awarding the death benefits
provided by the ITF Agreement sans any proof of the applicability thereof.
• Since the ITF Agreement is not applicable in this case, we apply the minimum acceptable terms in a
seafarer's employment contract provided by the POEA-SEC.
- However, in Legal Heirs of Deauna v. Fil-Star Maritime Corp., we clarified that beneficial CBA clauses
prevail over the POEA-SEC: A contract of labor is so impressed with public interest that the more beneficial
conditions must be endeavored in favor of the laborer. This is in consonance with the policy of the State to
give maximum aid and full protection to labor as enshrined in Article XIII of the 1987 Constitution. (Emphasis
supplied)
• We then proceed to an inquiry into whether or not the compensability clauses in the CBA provide
greater death benefits to the seafarer than those granted under the POEA-SEC.
Section 20(A)(l) of the POEA-SEC provides that in case of the work-related death of a seafarer during the
term of his contract, the employer shall pay his beneficiaries the "Philippine Currency equivalent to the
amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars
(US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the
exchange rate prevailing during the time of payment." Section 25(1) of the CBA states that petitioners
shall pay compensation to a seafarer for any death arising from an accident equivalent to USD 80,000.
Section 25(5) further provides that if a seafarer "dies from natural causes or illness while in the employment
of the Company, the Company shall pay fifty percent of the quantum payable for death x xx."

- Comparing these two provisions, the CBA clearly provides higher death benefits of USD 80,000.
However, the cause of death of the seafarer must be due to an accident; otherwise, his beneficiaries would
receive only USD 40,000.
- That amount is lower than the benefit granted by the POEA-SEC, which is USD 50,000. But before
beneficiaries may receive compensation under the POEA-SEC, there must be substantial evidence that the
seafarer died of a work-related illness.
- The labor tribunals should have ascertained whether or not Efren's death was caused by a work-
related illness.
Burden of Proof in Compensation Proceedings for Seafarers
• In its assailed Decision, the CA sustained the appreciation of the NLRC that petitioners failed to
show that Efren died from a non-compensable illness.
- The CA believes that employers have the duty to prove that a seafarer died from a non-compensable
illness.
• However, in numerous cases, this Court has explained that "whoever claims entitlement to the
benefits provided by law should establish his rights to the benefits by substantial evidence." Hence, the
claimants of death benefits, and not the employers, carry the burden of proof.
- We elucidated in Quizora v. Denholm Crew Management (Philippines), Inc. that in granting the
provisons of 2000 POEA-SEC, the claimant has to substantiate his claim in order to be entitled to disability
compensation. He has to prove that the illness he suffered was work-related and that it must have existed
during the term of his employment contract. He cannot simply argue that the burden of proof belongs to
respondent company
• Therefore, in resolving the death claims of respondent, the CA proceeded from an incorrect legal
framework, which this Court must rectify.
- In a petition under Rule 45 of the Rules of Court, what the Court reviews are the legal errors that the
CA may have committed in the assailed decision.
• The correct approach in adjudging claims of seafarers for death and disability benefits is to
determine whether the claimants have proven the requisites of compensability under Section 32-A of the
POEA-SEC, viz: (1) the seafarer's work must have involved the risks described therein; (2) the disease was
contracted as a result of the seafarer's exposure to the described risks; (3) the disease was contracted within
a period of exposure and under such factors necessary to contract it; and (4) there was no notorious
negligence on the part of the seafarer.
- In this case, respondent fails to satisfy positive propositions on compensability. First, she did not
describe the tasks performed by Efren on board and how his work environment caused his fever and
headache and worsened into a fatal illness; Second, given the dearth of evidence as regards Efren's actual
job, there was absolutely no showing of how his duties or tasks contributed to the development of his
illness. There is no basis his illness was the result of his exposure to the risks of his trade
- Theis case is similar to Covita v. SSM Maritime Services, Inc. In that case, we said that by failing to
prove the nature of the work of the seafarer, logically, the claimants would not be able to prove the work-
relatedness of his illness.
• Given that none of the labor tribunals made a factual determination of the work assignments of Efren
as an able-bodied seaman, this Court finds an utter lack of basis for granting the POEA-SEC's USD 50,000
death benefits to respondent.
• Nonetheless, as earlier explained, respondents are still entitled to claim the death benefits provided
by the CBA. Section 25(5) thereof grants USD 40,000 regardless of whether the seafarer died of a work-
related illness, provided that he died while in the employment of petitioners.
- Therefore, petitioners were correct to offer respondent only USD 40,000.
• This circumstance is an exercise of good faith on the part of petitioners. It would negate the
imposition upon them of moral and exemplary damages, as well as attorney's fees. These forms of indemnity
may only be imposed on a concrete showing of bad faith or malice on the part of petitioners.
WHEREFORE, the assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP Nos. 03832-MIN
and 03841-MIN are hereby REVERSED and SET ASIDE, and a new one ENTERED ordering petitioners to
jointly and severally pay respondent the death benefits of Efren B. Malicse amounting to USD 40,000.00 or its
peso equivalent at the time of payment, which shall earn legal interest at the rate of six percent (6%) per
annum from the finality of this Decision until fully paid.